Malaysia's second national carmaker Perodua is eyeing an assembling pact with Japan's Toyota Motor Co. in a bid to strengthen its foothold ahead of market opening in 2005, a report said yesterday.

Japanese minicar maker Daihatsu Motor Co. Ltd., which is a subsidiary of Toyota, owns 51 percent stake in Perusahaan Otomobil Kedua Sdn. Bhd. (Perodua).

"Perodua is manufactured by Daihatsu, which in turn is owned by Toyota. So it is a natural progression," an industry source told The Star , saying negotiations were underway.