China's new emission and fuel economy policy is giving Japanese carmaker Toyota Motors  a hard time to reach its 2 million vehicles per year quota there by around 2025, the car manufacturer's head said on Sunday.

The company is reevaluating its current product line-up to clear regulations and at the same time earn money and reach volume target, Hiroji Onishi, Toyota's head of China operations, said.

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"It's becoming difficult to meet China's more and more stringent emissions and fuel economy regulations," he said at a media event ahead of the Beijing auto show.

"In order to meet those regulations, we have determined that we need to sell a considerable number of smaller cars, hybrid and other special cars."

On Sunday, Onishi announced Toyota Motor's plans to sell heavily electrified "plug-in hybrid" cars in China in 2018. It will release plug-in hybrid versions of the Toyota Corolla and Levin.

Fortune reports Toyota is potentially taking advantage of the Chinese government's attempt to change funding from backing electric vehicle production to giving rewards to companies that create new technologies. China aims to have 5 million new energy vehicles running over the next four years to lessen emissions, which could improve air quality.

He also shared his belief that minivans have the potential to be the next big hit in China's ever changing car industry. Multipurpose-multiperson vehicles (MPVs) are poised to hit the market after China has finally scrapped its one-child policy.

Onishi thinks China's vehicle preference is bound to change as Chinese families become bigger. Although he acknowledged that for now, Toyota do not see the big demand yet, he believes the country is warming to the idea.

Toyota's sales in China skyrocketed nearly 41 percent than that of in 2015, selling over 100,000 units. That compared with a 6.3 percent year-on-year increase in February, according to Reuters.

TagsToyota Motor Corp, china, automobile industry, car market, Beijing auto show