Madam Chair, vice-chairs and members of the committee, thank you for the opportunity to speak to you on this very important matter.
I'm here on behalf of Toyota Motor Manufacturing Canada, and I have responsibility for external affairs for all of Toyota's operations across Canada, including our interactions and engagement with all levels of government.
TMMC has been building vehicles in Canada since 1988, and this summer we will build the 10 millionth vehicle in our history, expected to be our newly launched Lexus NX. We've been the largest automotive manufacturer in Canada over the past five years, and last year we were responsible for nearly 40% of all vehicle manufacturing in Canada, producing more than 427,000 vehicles despite significant well-known challenges to global supply chains. We employ more than 8,500 Canadians, and we're the most awarded plants in the Americas, and second-most awarded in the world according to J.D. Power and Associates' initial quality survey.
Since our inception in Canada, our mission has been to build high-quality vehicles for the North American marketplace. Since 1988 we've enjoyed duty-free access into the U.S. market, first through the Canada-U.S. FTA, then NAFTA and now CUSMA. Each of those successive agreements has allowed us to grow from a single plant producing 50,000 Corollas per year to three plants and two sites producing 500,000 vehicles per year. We are one of the largest Toyota plants operating globally and the largest Toyota plant in North America by volume.
We produce the best-selling non-pickup truck in North America and the two top-selling vehicles within our Lexus luxury nameplate. With the addition of the Lexus NX production in March of this year, we'll build hybrid electric versions of all of our vehicles on every line. We're already producing electrified vehicles in Canada in high quantities and will continue to do so as our products continue to progress along the electrification spectrum.
We're a Canadian success story. Last year, 87% of our production was exported to the United States. The U.S. market is roughly 10 times the size of the Canadian market and has a profound impact and effect on our Canadian manufacturing operations. We produce more than twice as many cars in Canada as we sell in Canada, and the latter total includes vehicles produced in the U.S., Mexico and Japan.
Continued preferential access to the U.S. market is essential for us to maintain our production profile and continued employment for our team members. There is no realistic scenario in which we can service the Canadian market only and retain our current production levels and levels of employment.
In recent years, even after the successful negotiation of NAFTA, we've seen increasing threats to our preferred access to the U.S. market. First it was through a different and more stringent interpretation of rules of origin by the USTR, and more recently it is through proposed legislation in the United States that would effectively give preferred access through consumer tax rebates for qualifying electrified vehicles produced by three specific U.S. headquartered companies, in clear violation of the CUSMA recently agreed to by both countries and Mexico.
The catalyst for most of this action is the clear recognition by both governments and industry that the future of automotive is electrified. The industry will be undergoing unprecedented changes as internal combustion powertrains are gradually replaced by electric motors and batteries. Each automotive company will have its own public position on the pace of electrification, some more aggressive and some more pragmatic, but there's no disagreement on the end goal of shifting to a carbon-free automotive future.
Inherent in this is the understanding that batteries—1,000-pound 100-kilowatt batteries—and more specifically the ability of companies to source or build them within North America will determine the future winners and losers in the automotive marketplace. Nations understand this, and the United States sees this as an opportunity to shift production of both automobiles and these new powertrains from lower-cost jurisdictions, such as Mexico and overseas countries, into the United States, thereby securing jobs and technology while reshaping the automotive landscape.
There is tremendous risk to Canada in this scenario, and if we're unable to maintain preferred access to the U.S. market and compete on a level playing field, investments will flow into the United States at the expense of Canada, and our industry will be further weakened.
Canada must enforce its trade agreements with the United States and build a Canadian value proposition that creates broader value within the North American marketplace. One way to do this is through the development of battery supply chains. This has been mentioned elsewhere, so I won't dwell on it, but we need to focus our energies on turning things in the ground into things that we can actually use. It's not enough to say we have lithium reserves in the ground in northern Quebec. We need to transform that natural resource into highly refined battery-grade material at a competitive cost. This could be a distinct advantage for Canada and a transformative opportunity for our natural resources sector.
At the opposite end of the electrification spectrum, we need to find customers for batteries in Canada. There's a perception in the public space that if Canada could secure a large-scale battery manufacturing operation, that would attract battery-electric vehicle assembly to Canada. This is completely backwards. We need to secure product mandates for electrified vehicles first. We need to establish a critical mass of hybrid, plug-in hybrid and battery-electric vehicle production at our plants in Canada to attract battery production mandates.
Batteries, by their nature, are very large and very heavy. The associated logistics cost to ship a battery over any great distance is much greater than that for the powertrains they are replacing. Once increasing volumes reach a critical mass, economics force companies to localize production close to the customer in order to overcome increasing logistics cost. This is how you attract battery plant investments, and further, how you find the true customers for your refined raw materials.
These logistics challenges—