While many auto manufacturers are moving towards an electric vehicle lineup, Toyota’s CEO recently expressed concern over the massive shift in auto manufacturing.
Toyota President Akio Toyoda said he is among the silent majority in the auto industry questioning whether electric vehicles should be pursued exclusively, according to The Wall Street Journal.
“People involved in the auto industry are largely a silent majority,” Toyoda said. “That silent majority is wondering whether EVs are really OK to have as a single option. But they think it’s the trend, so they can’t speak out loudly.”
Toyota’s competitors, General Motors Co. and Honda Motor Co., have set deadlines for their lineups to be all-EV. General Motors has set its date at 2035, while Honda says it will roll out 20 new EVs by 2030.
Still, Toyota, the world’s biggest auto manufacturer and pioneer of the hybrid vehicle, is sticking to a diverse strategy that consists of hydrogen-powered cars and hybrids, according to The Wall Street Journal.
Amid growing competition between car manufacturers for expensive lithium batteries, and with the infrastructure needed to charge EVs still in its early stages of development, Toyota is keeping its focus on hybrids and wants to develop a diverse lineup.
“Because the right answer is still unclear, we shouldn’t limit ourselves to just one option,” Toyoda said.
While EV startups Lucid and Rivian can appeal to a specific customer base keen on EVs, legacy automakers have a much broader customer base, including those living in rural areas and developing countries with unreliable electricity supplies. Internal combustion engine vehicles are still providing most of the profits that enable these bigger auto manufacturers to foray into the EV business.
Although the market share of EVs has risen to around 6.5% of the total new-car market, according to J.D. Power, many buyers are coming from the East and West coast, putting a heavier emphasis on the shift to EVs.
“The coastal areas, the East and West coast, that’s electrifying much quicker than the interior of the country,” said Jim Rowan, CEO of Volvo Cars.
Toyota has been slower to unveil fully electric models in major markets, and its CEO said it took all types of vehicles seriously. In 2021, the company said it plans to spend up to $35 billion on its EV lineup through 2030. The company has sold only 14,421 electric vehicles worldwide as of October 2022.
Other major Japanese car manufacturers have expressed a similar sentiment to Toyota and are reluctant to shift their business to EV-only. Mazda Motor Corporation worried that EV batteries were too big and expensive to replace gas-powered vehicles and were better suited to smaller cars that Americans did not want.
Toyoda said the company’s commitment to EV alternatives is starting to get a better reception from government officials and others involved in the auto industry.
“Two years ago, I was the only person making this kind of statement,” Toyoda said.
