Five months since Toyota started selling its first all-electric car to compete directly with Tesla, hardly any of them have been seen on the road.
The rollout of the bZ4X sport utility vehicle was intended as a watershed moment for the world’s largest carmaker by sales. Its first mass-produced EV was Toyota’s answer to investor criticism that it had been slow to embrace the industry’s transition to electric.
Instead, the long-awaited debut was hampered by a humiliating global recall because of safety problems and supply chain delays caused by the coronavirus pandemic. With the rollout of the bZ4X only just resumed, Toyota has spent much of the year on the defensive and under scrutiny for its lobbying against rules designed to encourage a shift to electric vehicles.
“Toyota is not correctly responding to calls from the market to take a lead in electric vehicles. Toyota needs to demonstrate their leadership, otherwise they could not only misrepresent their green efforts but also lose investor confidence,” said Satoru Aoyama, senior director at Fitch Ratings.
For many years, Toyota could cope quite easily with emissions limits on its fleet set by regulators in Europe, the US and China, largely thanks to its wildly popular hybrid range spearheaded by the Prius.
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But tougher rules in major markets mean it will have to sell significant numbers of battery-only models in the coming years or risk large fines. It is also being forced to rethink its longtime strategy of focusing on hybrids as the less polluting answer during the EV transition.
In Europe, where the vast majority of Toyotas sold are hybrids, the company will have to switch to selling zero-emission models only by 2035, and in some cases by the end of this decade.
In North America, the group’s largest market, company president Akio Toyoda recently said that meeting a proposed US target for half of sales to be electric vehicles by 2030 would be “very difficult.”
For the moment, however, the going is good. Despite supply chain disruptions, Toyota recorded a record net profit of ¥2.8 trillion ($19.7 billion) for the year ended in March, up 27 per cent from a year earlier. Its shares are up 43 per cent over the past five years, compared to a 10 per cent fall at Volkswagen and a 28 per cent drop at General Motors. The company sold 6.2 million vehicles in the year to the end of August, 28 percent of which were hybrid.
Financial Times
Japan’s largest carmaker has long argued that a swift enforced shift to electric vehicles will increase emissions because of the huge ramp-up in production required. Hybrids, which run with a modest battery and a small petrol engine, provide a much cleaner interim solution, it says.
Toyota chief scientist Gill Pratt told a Financial Times summit this year that steering the industry exclusively towards electric cars that rely on large batteries is “not a good idea if your goal is to reduce carbon dioxide emissions totally around the world as much as possible” and that EVs were “not the only answer”.
But to guard against the risk of missing out on a revolution and of losing its decades-old reputation as a pioneer in green technology thanks to the Prius, in December Toyota pledged to invest $35 billion in the shift to electric vehicles by 2030 and to make 3.5 million of them by the end of the decade.
