To the latecomers are left the shreds. And for Toyota , that could be tough to digest.

After years of shunning mass-market electric vehicles, the world’s largest car maker finally capitulated to the market last week, quietly putting out a statement that it is forming an in-house unit to build battery-powered cars as an “alternative means” to reaching zero-emission standards.

While Toyota produces over 70% of the world’s hybrid cars and has been a vocal supporter of expensive fuel-cell vehicles, it has yet to fully embrace battery-operated cars. The company quickly backed out of an early investment in Elon Musk’s Tesla to focus on fuel-cell vehicles.

So what has finally dragged Toyota onto the electric road? In a word, China.

The world’s largest car market is going full throttle on eco-friendliness with a complex set of regulations that will penalize car makers that produce an insufficient number of electric, plug-in-hybrid and fuel-cell models. Basically, by 2018, such cars must account for 8% of the maker’s production, and the percentage will rise from there. Chinese state media has trumpeted the regulations as essentially barring car makers that don’t have new-energy capabilities.