Toyota Kluger 2027: Australia to retain hybrid power, but will it be a new SUV or a Chinese version of the existing model?  

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As production of the fourth-generation Kluger wraps up in the US (where it is badged ‘Highlander’) in lieu of an all-new, all-electric version built in left-hand-drive only, Toyota Australia has reached a fork in the road.

Will it switch Kluger Hybrid production sourcing to China, where the current XU70 model has been manufactured since late-2020? 

Or will it replace its five-year-old large SUV with a right-hand-drive version of the larger Grand Highlander/Kluger, sourced from the same factory in Princeton, Indiana that has been building our Klugers for many years?

Chasing Cars spoke to Toyota Australia’s Vice President Sales, Marketing and Franchise Operations, John Pappas, who confirmed that the “Kluger nameplate will keep going [in 2027], and we’ll see basically what powertrain becomes available to us. And then we’ll make the call based on that – what we take for our market.”

Pappas said there’s enough stock of the current US-built Kluger Hybrid to satisfy demand in 2026, and he has previously confirmed that Australia won’t be seeing the all-new BEV version – not for the time being, at least.

But Toyota Australia’s executives weren’t yet willing to divulge which vehicle will wear the Kluger nameplate in Australia from 2027.

If the GAC Toyota joint-venture factory in Guangzhou can build an XU70 Kluger Hybrid in right-hand drive, then Chinese sourcing could provide a cost-effective solution.

But the more appealing, if more expensive option would be to engineer a right-hand-drive version of the Princeton-built Grand Highlander/Kluger to step in as our fifth-generation 2027 Kluger.

When discussing the topic of US production, Toyota Australia’s Senior Manager – Product Planning and Pricing, Ray Munday, made a specific effort to point out that the new-generation BEV isn’t the only Highlander/Kluger built in North America – “so that Grand Highlander, sorry, Highlander BEV is not the only Highlander product from North America – that’s [just] one product,” he said, perhaps tellingly.

And when Pappas said that Toyota Australia was ‘waiting to see what powertrain becomes available’ from North America, there’s a good chance he could be referencing the two hybrid powertrains available in the Grand Highlander/Kluger.

Launched in 2023 in North America, the Grand Highlander/Kluger is essentially a stretched and widened regular Highlander/Kluger – 150mm longer, 60mm wider and around 25mm taller, riding on a 100mm-longer wheelbase.

Looking conservatively handsome, with a more upmarket interior aesthetic than its smaller sibling, the Grand version has been a hit in the US – selling 136,801 units in 2025 compared to just 56,208 for the regular Highlander/Kluger (down from its 264,128 sales record in 2021). In Australia, Kluger Hybrid sold 8098 units in 2025.

In terms of powertrains, Grand Highlander/Kluger is identical to the regular Kluger. In the US, that means a 198kW 2.4-litre turbo-petrol four-cylinder (discontinued in Australia in mid-2024) or the same 184kW 2.5-litre petrol-electric hybrid four as our current Kluger Hybrid, driving through an ‘eFour’ AWD system.

The Americans also offer a ‘Performance Hybrid’ version of the 2.4-litre turbo-petrol four – called the ‘Hybrid MAX’ – which boosts system power to 270kW and increases torque beyond 500Nm. If marketed in Australia, this Kluger would become the baby brother to the twin-turbo-petrol V6 LandCruiser 300-series and Tundra pick-up ‘Performance Hybrids’.

Should the Grand Highlander Hybrid (or Hybrids) become our fifth-generation Kluger in 2027, Toyota Australia would have unbeatable coverage of the medium-to-large SUV/4WD categories, including three new RAV4 plug-in hybrid variants.

A less likely 2027 Kluger option – but one that’s still possible – is to wait for petrol-hybrid and plug-in-hybrid versions of the all-new, fifth-generation Highlander/Kluger BEV.

Given that Toyota’s new electric large SUV is based on the same TNGA-K architecture as the fourth-gen Highlander/Kluger and the larger Grand Highlander, it theoretically has the capability to accommodate more than just pure electric powertrains.

But if that happens, it will potentially be some time away due to the popularity of the Grand Highlander/Kluger in the US, plus Toyota’s insistence that the Kentucky-built, new-gen Highlander/Kluger will be BEV-only.

In a matter of months, we’ll know exactly what our 2027 Kluger will be – most likely either a re-nameplated Grand Highlander or a Chinese-manufactured version of the SUV we’ve known since 2021.

Here’s hoping it’s the former.