This is too simplistic, the marketplace and production/manufacturing realities are far more complex. Toyota is buried by the demand for their other vehicles, particularly their hybrids. They simply don't have the free resources to produce something that they aren't ready to produce. Toyota has the capability of designing, developing, and manufacturing any kind of quality product that they want, but in their own time frame because they are extremely cautious and take a long-term measured approach with everything that they do.
BYD BEVs are a very new product. Just because they are manufacturing and selling a lot of them doesn't make them well developed (they aren't) or any good (they may not be, here in the US we don't really know how good or bad they really are, based on the bZ4x I would say that they aren't very good, yet).
Putting their name on and marketing a under-developed BYD BEV was a mistake and Toyota knows it.