How Toyota is revamping its strategy on EVs under its new CEO
- Apparently, Toyota is looking to achieve a new goal of producing over 10,000 EVs monthly by 2026.
- Toyota is expected to begin producing electric SUVs in the US by 2025, and the Japanese automaker is also expected to announce plans to build a facility to assemble EVs in Kentucky, US.
- The company also aims to sell about one million EVs globally by 2026.
Toyota, long known for its hybrid vehicles, is also known for its cautiousness to invest in fully electric vehicles (EVs). While the global auto industry was busy transitioning to a battery-powered future during the last couple of years, the Japanese automaker was barely getting started on its journey. Then, in April 2021, Toyota announced an EV strategy which started with a goal to have 15 new battery-EVs by 2025.
The EV strategy, however, was revamped a few times. By December 2021, Toyota had new plans to invest a staggering 4 trillion yen (US$35 billion) to build a full lineup of 30 battery-powered EVs by 2030. The automaker also had a new global battery EV sales goal, from two million to 3.5 million units a year, by the end of this decade.
But all that was under CEO Akio Toyoda. In January this year, the company announced that Toyoda will step down as President and Chief Executive to become Chairman from April 1. Japan’s biggest automaker will be led by the company’s top branding officer, Koji Sato. One of Sato’s earliest orders of business was pledging to reform the company’s EV strategy “drastically”.
Sato’s move came at a time when Toyota was being criticized by investors, environmental activists, and EV enthusiasts for falling behind in the global EV race. Therefore, he aims to accelerate the rollout of new EVs as part of his goal to reinvent the world’s largest automaker.
Sato said he is prioritizing a three-pronged strategy after he takes over from Akio Toyoda as CEO on April 1. The priorities will be to ramp up the carmaker’s EV strategy, strengthen its Woven-related software-first initiatives, and focus on achieving carbon neutrality in Asia. “I don’t think a one-size-fits-all solution works,” Sato told Automotive News.
He noted that the renewed focus on EVs is not solely a reaction to increased competition from US and Chinese startups, as well as traditional rivals like General Motors and Volkswagen. Sato’s top priority is also to rethink Toyota’s battery electric product plans. “The first is business reform starting with next-generation BEVs. To deliver attractive BEVs to more customers, we must streamline the structure of the car and with a BEV-first mindset, we must drastically change the way we do business,” he said.
Of EVs, SUVs, and Toyota in the US
According to a report by Nikkei Asia this week, Toyota will begin producing mid-to-large-sized electric sports utility vehicles (SUVs) at its Kentucky plant as early as summer 2025. The report stated that the Japanese automaker is aiming for a monthly output of more than 10,000 by the year’s end.
Nikkei even shared that Toyota aims to sell about 1 million EVs globally by 2026. The company has yet to announce because a decision hasn’t been made on when EV production will start in the US. To date, Toyota has invested US$3.8 billion in a battery plant in North Carolina that’s expected to become operational in 2025.
After selling a mere 1,220 units of its first electric SUV, the bZ4X, in the US last year, the company could use some help scaling production. As Electrek points out, producing electric SUVs in the US would allow Toyota to streamline production and get EVs into customers’ hands quicker while avoiding expensive transport fees. In that case, ramping up production of EV manufacturing in the US would be a big step for Toyota.