Toyota Motor Corp. executives are sounding more confident in their ability to build and sell millions of electric vehicles.
(Bloomberg) — Toyota Motor Corp. executives are sounding more confident in their ability to build and sell millions of electric vehicles.
Consumers making the transition to fully electric cars from hybrids are giving the world’s largest automaker a good indication of where the market will be in three years, Chief Technology Officer Hiroki Nakajima said during a day-long set of technology briefings last week at Toyota’s research facility near Mount Fuji.
“Development and production will be ready when there’s demand for 1.5 million units,” he said, offering assurance that Toyota will achieve its goal to sell that many battery-electric vehicles by 2026.
The comments and hours of presentations contrasted from years of Toyota executives speaking cautiously about how quickly car buyers will be ready to go all-electric. The manufacturer’s management team also opened up about innovations in the pipeline for next-generation EVs, ranging from longer-range batteries to slicker aerodynamics and more efficient production processes.
While Toyota pioneered electrifying vehicles with the hybrid Prius, it’s now playing catchup to Tesla Inc. and China’s BYD Co. in selling cars powered entirely by batteries. Toyota is still espousing a multipronged approach to reducing vehicle emissions — it remains a believer in the potential of hydrogen and carbon-neutral fuels — but new Chief Executive Officer Koji Sato has championed an EV-first approach.
This was on full display near Fuji, a few hours from Tokyo, where Toyota engineers and product managers showcased their research and product plans. There were test drives of new vehicles and prototypes, including an EV that simulated a manual-transmission car with an clutch, and a Lexus SUV equipped with a hydrogen-burning combustion engine.
The manufacturer detailed its battery roadmap — including the potential commercialization of solid-state batteries within a few years — and showed off more advanced vehicle software, more compact e-axles and more affordable fuel cells.
Soon after taking over as CEO in April, Sato laid out plans to introduce 10 new EV models by 2026 and sell 1.5 million battery electric vehicles annually, as an interim step toward reaching 3.5 million by 2030 — a goal set by his predecessor Akio Toyoda, who’s now chairman.
Those are ambitious objectives, considering that Toyota sold around 38,000 battery EVs in the fiscal year that ended in March.
To put Toyota’s targets in perspective, it took the carmaker two decades from the introduction of the Prius in 1997 until its first year selling 1.5 million electrified vehicles, the vast majority of which were hybrids.
By combining a battery, electric motor and smaller combustion engine in an integrated powertrain, the carmaker was able to achieve efficiencies never seen before, giving hybrids significantly greater range and gas mileage that competitors.
Celebrities and environmental groups embraced the Prius, burnishing Toyota’s green credentials and helping propel it to overtake Volkswagen AG as the world’s largest carmaker. While Prius sales have tapered off, hybrid technology is now spread across Toyota’s lineup, including the Lexus brand. Reduced emissions from gas-electric vehicles remain a key element of Toyota’s multipathway approach to reducing emissions.
Read More: Toyota Will Keep Selling Prius as Long as Batteries Are Scarce
Nakajima was less declarative about Toyota’s sales goal for the end of the decade, given the differences in readiness for EVs and regulatory requirements across major markets, among other factors.
“There’s a reasonable basis for the target of 3.5 million units in 2030, but it is also quite far in the future,” Nakajima said. “It is true that we are still trying to assess whether that’s going to happen, for sure.”
Takero Kato, who leads Toyota’s battery EV efforts, said car buyers should expect a quicker tempo of product releases in the coming months and years. Two of the test vehicles at the event were battery-electric models that are close to production: a Hilux pickup truck unveiled in Thailand in December, and a mini EV from Toyota subsidiary Daihatsu Motor Co. that will hit the Japanese market by March.
“I don’t think these numbers are unachievable,” Kato said of the EV targets.
Toyota plans to roll out at least two new types of batteries within the next few years. One will debut in 2026 with a range of 1,000 kilometers (621 miles), along with improvements in weight reduction and airflow design, while cutting costs by 20% compared with the battery in the bZ4X sport utility vehicle. The other, a lithium iron phosphate battery slated for 2026 or 2027, will aim to reduce costs by 40% compared to what’s in the bZ4X while increasing range by 20%.
A bit further out, in 2027 or 2028, Toyota aims to start producing vehicles with high-nickel cathodes that will offer even greater range and cost improvements.
Toyota also spent time showing some of its new ideas for vehicle manufacturing, aimed at halving development costs and plant investment. Just as Tesla has worked with suppliers on simplifying the body structures that underpin its vehicles, using much fewer pieces of metal, Toyota will embrace what it referred to as a “giga casting” system. Moving to three-part body architectures will allow for greater interchangeability between front and rear structures and the batteries wedged in between.
One of the more radical ideas that the company vaunted for its production system is pursuing is to do away with assembly line conveyors by building EV powertrains on wheels that can drive autonomously from one workstation to the next.
Toyota’s executive team was convincing, according to Koji Endo, a managing director of SBI Securities Co. who attended last week’s briefings.
“Many doubted whether they can boost output by 500,000 units a year,” Endo said. “But after going to the research center, most analysts now think they can.”
–With assistance from Tsuyoshi Inajima.
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