Toyota is feeling the pressure to accelerate its EV production, especially in China. This could mean more global Toyota EV models in the future.
While the electric vehicle market in the United States is growing at a snail’s pace, China’s growth is more like a rabbit on speed. Most traditional automakers once thought entering the Chinese market would offer boundless opportunities, but local competition has changed the game. Several of the largest names in the EV world now call China home, which makes it even more difficult for a brand that’s struggling with EV technology to break through.
Toyota Has a Strong Presence in China
Actually, this brand has a huge presence in every auto market in the world. Toyota is the world’s top-selling brand, but its slowly developing EV lineup might be a hindrance in China. In order to maintain its strong presence in this market, Toyota will need to push forward with more EVs before originally thought. This includes a change to its supply chain and faster development of long-range batteries.
Toyota Might Be the Top Hybrid Brand
Toyota might be a little behind in providing EV models to the market, but it’s well ahead of other brands in terms of hybridization. When you think of a hybrid car, the first name that comes to mind is the Prius, which has been a Toyota staple for many years. Although China has embraced full EVs much faster than other automakers, there’s still a need for hybrid vehicles. This could give Toyota the market share it needs to continue to be a top performer in this market. Whether it’s a traditional hybrid or a plug-in model, Toyota offers a full lineup of options with names that we know and admire, including the Prius, RAV4, Camry, Corolla, and Highlander to name a few.
Accelerating Toyota EV Tech
In China Toyota works with suppliers Denso and Aisin for its powertrain components. To push progress forward toward a more robust EV lineup, Toyota is accelerating powertrain development with these two suppliers. This automaker is also focused on the local design and development of “smart cockpits,” which can be the next step forward in the Chinese automotive market. The accelerated development doesn’t stop there. Toyota has engineers from three ventures working together to bring better electrification to the brand.
While pushing forward with development to bring more EVs to the market, Toyota is also focused on reducing manufacturing costs in the area to be much more competitive in this market.
The Competition is Fierce in This Market
China is now the largest automotive market in the world, which makes sense considering the population of the country. While Toyota is facing some serious challenges in bringing more EVs to the market, other automakers are boosting investment and product development in the area.
Toyota recently slowed production of the bZ4X and laid off 1,000 contract workers, while BMW boosted its investment in the area with a new R&D center in Shanghai to help develop EVs that will reach many global markets.
Volkswagen also announced a stronger presence in the area. VW recently entered a partnership with Xpeng to make two new electric Volkswagens using Xpeng’s software. They also intend to build some Audi models and a new platform with another Chinese partner SAIC. These increased investments in full electrification fly in the face of Toyota with its lack of EV models in every market.
What Could this Mean for the North American Auto Market?
You might wonder why you should care about Toyota’s presence in China and its struggles, which don’t directly impact you. A harder push to develop a larger EV lineup and improved driving range for PHEVs could give us some new Toyota models in the United States. Most vehicles from foreign automakers are developed in other countries, and China is the largest auto market for electric vehicles.
The added competition could mean we see electrified versions of familiar Toyota names sooner rather than later. Currently, Toyota only has one EV model under its purview, but that might change sooner than the company gets solid-state batteries off the ground. This might bring us an electrified Highlander, Corolla, or Camry in the near future.
That said, if other brands are any indication of the future of the EV market, Toyota will most likely focus on SUVs and build EVs using new names that we haven’t heard before. Either way, the troubles in China could be the push Toyota needs to offer more electric vehicles in every auto market.
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