Toyota, the world’s largest automaker, has announced an ambitious plan to increase its electric vehicle (EV) production to 600,000 units by 2025, a three-fold jump from its previous target of 190,000 units by 2024. The company has informed its major suppliers of the new goal, as it seeks to compete with the rising EV giants like Tesla and BYD.
Toyota’s EV Strategy
Toyota has been a leader in hybrid and fuel cell vehicles, but has lagged behind in pure EVs. The company sold only 24,000 EVs in 2022 and aims to sell 150,000 EVs in 2023, according to Nikkei Asia. In contrast, Tesla sold over 1.8 million EVs in 2023 and plans to expand its global presence with new factories in Mexico and India.
To catch up with the EV trend, Toyota has unveiled a series of new models and technologies. The company plans to launch as many as 10 new Toyota and Lexus EVs by 2026, including a three-row SUV that will be assembled in the US at its Georgetown, Kentucky plant. The company also revealed its next-generation EV production line in Japan on September 19, 2023, which features advanced techniques such as giga casting, a three-part modular structure, and a solid-state battery development line.
Toyota’s EV Challenges
Despite its ambitious plan, Toyota faces several challenges in achieving its EV target. One of them is the global shortage of semiconductors, which has affected the production and supply of many automakers. Another challenge is the regulatory pressure from various countries that are pushing for stricter emission standards and faster adoption of zero-emission vehicles. Toyota has been criticized for lobbying against some of these policies, such as the proposed ban on new gasoline and diesel cars in the US by 2035.
Moreover, Toyota has to contend with the fierce competition from other EV makers, especially in the key markets of China and the US. In China, Toyota faces the challenge of local rivals such as BYD, Nio, and Xpeng, which have gained popularity and market share with their innovative and affordable EVs. In the US, Toyota’s pure EV sales are a fraction of Tesla’s, and considerably lower than Ford and General Motors. Toyota also has to deal with the consumer perception that its EVs are less exciting and innovative than those of its competitors.
Toyota’s EV Outlook
Toyota’s plan to triple its EV production target by 2025 shows its determination to become a major player in the global EV market. The company has a strong reputation for quality, reliability, and efficiency, which could give it an edge over some of its rivals. Toyota also has a loyal customer base and a wide distribution network, which could help it expand its EV sales. However, Toyota will have to overcome the challenges of supply chain disruptions, regulatory hurdles, and competitive pressures, as well as improve its EV design and performance, to achieve its goal.