Just as many automakers are faced with major changes in the emerging electric vehicle market, Toyota is reportedly looking to shift its plans to become more like Tesla. The Japanese automaker is one of many hoping to reach Tesla’s level of profitability in the EV sector, and it's now readying to unveil a new business model to do just that.
Above: A Tesla vehicle charging. Photo: Tesla
Toyota plans to outline a new EV strategy in January to detail its business model through 2026, in addition to shifting supplier relationships (via Barron’s). The announcement is the latest in a series of EV-related announcements in Toyota’s bid to catch Tesla, coming amidst criticism of the major automaker’s slow introduction of EVs to the market.
The changes will surround Toyota’s supplier base as the company hopes to make its offerings to the consumer more comparable to Tesla’s. Tesla only sells battery-electric vehicles, unlike most traditional automakers with a lineup consisting mostly of gas vehicles.
Despite being an early pioneer of hybrid vehicles with the Prius, and still being a major player in the hybrid market, Toyota released its first EV this year. The bZ4X was also built on the company’s first EV platform, which will be shared with Subaru’s first few EVs.
Toyota only sold 14,421 battery-electric vehicles worldwide in 2022 through October, while competitors Tesla and BYD both sold well over half a million vehicles. Tesla doesn’t report its monthly deliveries, but the U.S. automaker shipped 908,583 vehicles in the first three quarters of the year to seemingly beat out BYD’s 685,286 battery-electric delivered through October.
As for Toyota’s hybrid vehicles, it’s a different story. The automaker sold nearly 2.2 million hybrids through October, although hybrid sales are generally decreasing year over year with the introduction of added battery-electric options.
Reports from last year also show that Toyota lobbied against battery-electric vehicles in Washington D.C. for years, favoring the potential for hydrogen as the market’s next clean energy option. Toyota’s plans to unveil an updated EV strategy are not only timely, but they’re somewhat of an admission to the company’s lost bet against battery-electric vehicles.
Meanwhile, Tesla’s increases in production throughout the world are slowly inching the company toward major automaker levels of volume manufacturing. As a result, the company is firmly positioned as the example-setter in the EV space, and Toyota is among several companies hoping to carve out their own positions alongside Tesla in the growing battery-electric market.