Toyota reshuffles EV plans with 10 brand-new models by 2026

Koji Sato, the newly appointed Chief Executive Officer of Toyota Motor Corp., unveiled the beginnings of a long-awaited plan for electrifying the company's vehicle lineup at his first press conference. However, he did not provide any concrete details on how the company can compete with its rivals in electric vehicles abroad.

‍

Often referred to as a mobility company that wants to change the future of cars, the Japanese automaker on Friday announced that it will release 10 new electric car models by 2026 and sell 1.5 million battery electric vehicles annually by then. To fulfill its commitment to halve emissions by 2035 and become carbon neutral by 2050, the company is also committed to strengthening hybrids and plug-in hybrids. 

‍

"First we must do what we can and start by electrifying the company," Sato said in his first public appearance since taking over as CEO and president on April 1. While he didn't completely embrace a 100% electric future like some of his fellow automakers have, he did highlight Toyota's unique strategy of tackling carbon neutrality in multiple ways during the presentation on Friday, reinforcing the company's stance on taking a multi-pathway approach.

‍

By 2025, Toyota plans to have a locally produced battery SUV as well as increase battery plant production locally in North America in addition to providing a more advanced version of its bZ series of EVs in developed markets. It is anticipated that by 2024, it will be launching two electric models developed locally in China. It is also expected that Toyota will focus its efforts more broadly on battery pickup trucks as well as compact electric cars in Asia.

‍

In order for Sato to steer Toyota, which is expected to produce 10.6 million cars this year, through a new era of electrification and intelligent vehicles, he will need to build a dedicated EV production platform from scratch while navigating pandemic measures, supply chain issues, and semiconductor shortages. Sato's priority is to build a dedicated EV production platform from scratch.

‍

"I expected them to talk about Toyota's values, manufacturing, and Kaizen in a general way, but it was interesting to learn about the company's stance on electrification, intelligence, and diversification as well," analyst Tatsuo Yoshida stated, referring to the Japanese philosophy of continuous improvement as well. "In the course of our conversation, they disclosed things that they may have been planning and thinking about, but never really revealed to us."

‍

Toyota is one of the world's largest car manufacturers, employing some 370,000 people globally, and is also the largest employer in Japan, which makes decarbonizing Toyota a crucial step for the island nation to achieve its carbon reduction goals, phase out fossil fuels, and mitigate climate change. While Toyota's CEO, Akio Toyoda, was keen to clarify during the 90-minute press conference that while the company views carbon as the enemy, it's essential that we do not leave anyone behind in the transition to an eco-friendly future.

‍

In February, the 53-year-old former head of Toyota's luxury brand Lexus and its motorsport division Gazoo Racing said he would take an "EV first" approach for the future, promising to overhaul the company's battery production and manufacturing platforms by 2026 and put Lexus at the center of all of it. Upon the announcement of the realigned plan, when it's unveiled in its entirety, Toyota will likely be in direct competition with both Elon Musk's Tesla Inc. and China's BYD Company, two of the biggest players in the global EV sphere.

‍

Yoichi Miyazaki, Toyota's Executive Vice President, said that if demand warrants further North American production, Toyota would consider further North American production, without providing further details. President Joe Biden's historic climate bill encourages electric car production in the US and the sourcing of EV supply chain components from outside of China.

‍

Toyota announced in December 2021 that it would sell 3.5 million electric vehicles annually by 2030, but in the fiscal year ending March 2022, battery-electric vehicles made up only 16,000 of the 9.5 million vehicles it sold. During his tenure as Toyota's CEO, Akio Toyoda, now serving as the company's chairman, has for years defended his position that the company should continue to offer customers a diversity of vehicle options, including those powered by hybrid electric engines and traditional internal combustion engines.

‍

“More than anything else, it is essential that we stick to our multi-pathway strategy,” said Hiroki Nakajima, Executive Vice President of the company on Friday.

‍

EVs were expected to take the market by storm when Toyota introduced its first EV, the bZ4X, last year. It turned out to be a disappointment for customers when thousands of cars were recalled because of fears that the tires could come off because the wheels weren't bolted on tightly enough, leading to concerns that the tires could come off.

‍

There was a slight dip in Toyota shares in Tokyo trading, as they fell by 0.4%.