Toyota President Akio Toyoda nd Mazda President and CEO Masamichi Kogai at a joint press conference on August 4, 2017 in Tokyo, Japan.

Toyota is establishing a new venture to develop electric vehicle technology with partner Mazda, seeking to catch up with rivals in an increasingly frenetic race to produce more battery-powered cars.

Policymakers in key markets like China are aggressively pushing a shift to electric cars over the next two to three decades, pressuring traditional automakers to crank up their electric vehicle (EV) plans — just as declining battery costs enable more power to be packed into cars.

Toyota said in a statement the new company will develop technology for a range of electric cars, including minivehicles, passenger cars, SUVs and light trucks.

Toyota will take a 90 percent stake in the joint venture, called EV Common Architecture Spirit, while Mazda and Denso, Toyota's biggest supplier, will each take a 5 percent stake.

The plans build on a partnership announced in August when Japan's biggest automaker agreed to take a 5 percent stake in Mazda and two said they would jointly develop affordable electric vehicle technologies.