Toyota to Readjust its EV Strategy to Compete with Tesla and BYD

Toyota has been too slow to develop pure electric vehicles, however now the Japanese automaker wants to pick up the pace, as it tries to keep pace with industry leaders– Tesla and BYD.

According to Reuters, Toyota will outline adjustments to its EV strategy through early 2026 to its supplier base in an effort to improve its offerings to narrow the gap on price and performance relative to the aforementioned EV leaders.

As per report, Toyota has been looking at ways to improve the competitiveness of EVs being planned for this decade, in part by speeding up the adoption of performance-boosting technologies for planned EVs, from electric drive systems – including motors – to the electronics that convert power from the grid to energy stored in batteries and more integrated heating and cooling systems.

Related: BYD Reveals Yangwang Brand Logo

The changes, however, might include delays to some of the EV development programs originally planned for the three-year period, one of the people familiar with the matter said. The changes would be for the successors to Toyota’s first two EVs for major markets, the bZ4X and the Lexus RZ, and intended to close the gap with Tesla & BYD on cost and performance.

Toyota is set to convene a major suppliers meetup in February, the first such global supplier convention since the pandemic. The Japanese automaker said in a statement that it is “always actively discussing and working with key (suppliers and partners) on a variety of topics,” to achieve carbon neutrality. But it said it had no new details to disclose on EV development projects.

Related: Tesla Earns 8 Times More Profit per Car than Toyota

Tesla made almost 8 times the profit per vehicle as Toyota for the third quarter, partly because of its ability to simplify EV production and reduce cost, analysts have said. Thus Toyota has been reviewing a $30-billion, three-stage plan for developing and releasing EVs it announced late last year. It has suspended work on some battery-powered car projects announced last year, while a working group headed by former chief competitive officer Shigeki Terashi looks to improve cost performance and technology in the fast-growing market for EVs.

The working group has been charged with outlining plans to improve Toyota’s EV approach, including considering a potential successor to its new EV platform, e-TNGA. The revamp comes even as Toyota holds the view that hybrids will remain a crucial part of the transition to carbon-neutral transport. Most major automakers expect EVs to account for the majority of vehicle sales by 2030, and green investors and environmental groups have pushed Toyota to move faster as industry-wide EV sales exceed Toyota’s earlier assumptions.

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