It feels as if
the pioneer of hybrid electric-vehicle technology, has been dragged kicking and screaming into the age of all-battery-powered personal transportation. Now the Japanese auto maker is leaning harder into the all-electric technology pioneered by
(ticker: TM) unveiled a new goal to sell1.5 million battery-electric vehicles, or BEVs, annually by 2026, coming from 10 new models.
“As one of our efforts, we will do our utmost to develop next-generation BEVs for the era of BEV popularization and create new business models,” President Koji Sato said during a presentation to investors Friday.
Toyota’s previous plan called for about 3.5 million all-electric sales annually by 2030, coming from 30 models. Toyota sells roughly 10 million cars a year.
“We are fully committed to achieving carbon neutrality in 2050 over the entire life cycle of our vehicles,” Sato said Friday. Carbon dioxide emitted from the burning of fossil fuels, such as gasoline, is the main gas blamed for global climate change. “We will promote, in a practical manner, the popularization of electrified vehicles,” he added.
For Toyota, practicality means offering hybrid electric vehicles now, while expanding Toyota’s offering of battery-electric vehicles, or BEVs, in coming years. The company has always promoted a multipronged approach to no- or low-emission vehicles, with hybrid, battery-electric, and fuel-cell-powered vehicles all playing a role.
It isn’t hard to see why Toyota has favored hybrids: It sells a lot of them. Toyota shipped 2.6 million hybrid electric cars in 2022, while it only sold 22,689 BEVs.
The company’s new goal is a little more tangible, and easier to compare to other auto makers’ aspirations.
(F) wants to produce BEVs at a “run-rate” of two million units annually by 2026. That translates to between one million and two million sold in 2026, then the full two million—plus any growth—coming in 2027. Ford sold about 4.2 million vehicles overall in 2022.
(GM) wants to sell one million EVs in North America by 2025. GM sold about 2.9 million vehicles in North America in 2022.
GM and Ford’s numbers are a little more aggressive, as a percentage of total volumes, than Toyota’s plan. All three companies are chasing
(TSLA), which, of course, only sells EVs. Wall Street expects Tesla to sell 2.9 million vehicles in 2025 and 3.5 million in 2026.
One takeaway from Toyota’s new goals is the auto industry continues to push harder into the battery-electric trend. As batteries get better, the offering of hybrid vehicles doesn’t seem as compelling, as the combination of a gas engine plus electric motor and batteries adds costs.
Over the past 12 months, Toyota shares are down 20%. The
Dow Jones Industrial Average
are off about 9% and 3%, respectively.
Car stocks have been relative underperformers compared with the broader market. Investors have been worried that rising interest rates and declining vehicle affordability would hit new car demand in 2023.
Write to Al Root at [email protected]