Toyota is set to reboot its electric vehicle (EV) strategy to make it more competitive in a fast-growing market, setting its sights squarely on EV giant Tesla and considering it as the company to beat.
Toyota plans to reevaluate its EV strategy as global demand has dwarfed its own conservative projections
A Reuters report cites unnamed sources as saying that the Japanese automaker is already conducting a review of its EV program, led by former chief competitive officer Shigeki Terashi. “What’s driving Mr. Terashi’s effort is the EV’s faster-than-anticipated take-off and rapid-fire adoptions of cutting-edge innovations by Tesla and others,” one of the sources said.
In a major reversal from its previous position, there is now a general sentiment within Toyota that Tesla has set a new benchmark for EV manufacturing costs. Toyota previously had a stake in the EV maker a decade ago as they collaborated on producing the RAV4 EV. At the time, many Toyota engineers downplayed the potential of Tesla’s technologies.
A year after selling its shares in 2017, Toyota had a dedicated zero-emissions division and was at work on developing an e-platform. By then, Tesla had already overtaken it with three models available in the market.
Once underestimated by Toyota, Tesla has overtaken the world's number one automaker when it comes to EVs
Toyota’s decision to reboot its EV strategy will reportedly push back the rollout plan for its EV lineup announced in December 2021, amounting to $38 billion (over Php 2.22 trillion).
2022 marked the release of three new models – the Toyota bZ4X, Lexus RZ 450e, and Subaru Solterra – all underpinned by the e-TNGA (Toyota New Global Architecture) platform. The bZ4X and Solterra were recalled shortly after launch due to safety issues. Toyota is reportedly considering either extending the e-TNGA’s usefulness with the addition of new tech, or replacing it altogether with a new EV-dedicated platform.
The strategy review will bring costly delays in the planned rollout of Toyota's EV lineup
The world’s biggest automaker has been criticized by green investors and environmental groups for its slow adoption of EV technology. Toyota designed the e-TNGA platform with the goal of producing it on the same assembly line as gasoline cars and hybrids, based on projected sales of 3.5 million EVs a year by 2030.
However, the automaker had underestimated growth in the EV space, as its rivals now project that EVs will make up more than half of worldwide vehicle production by the end of the decade.
Toyota continues to develop hydrogen powertrains despite lackluster sales so far
In a statement, Toyota said that it remained committed to carbon neutrality without commenting on specific initiatives. Aside from electrification, the company is also pursuing development of hydrogen fuel cells and fuels for use in existing combustion engines.
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