Toyota Motor Corporation is reconsidering its electric vehicle (EV) production strategy in North America, a move seen as a direct response to underwhelming EV sales in the region and shifting dynamics in the global automotive market, as reported by Nikkei on Friday.
Industry insiders have revealed that Toyota plans to delay the start of production at its first EV factory in North America from 2025 to the first half of 2026. The company will opt to export certain models from Japan that were initially slated for local production in the U.S.
A Toyota spokesperson explained that the delays are due to “improvements in quality and changes to EV design” and that the company is cautious in determining the new production start date. This is the first time a Japanese automaker has publicly announced a reassessment of its North American EV plans.
Toyota has already informed parts suppliers of these adjustments. The global EV market, once booming, is now experiencing a dramatic slowdown in growth. Market research firms indicate that the global EV sales growth rate is expected to plummet from 58% in 2022 to just 9% by 2024.
Several factors contribute to the slump in EV sales, including insufficient charging infrastructure, high price points, and inflationary pressures. In particular, U.S. protectionist policies targeting Chinese EVs have also reduced price competitiveness.
A Toyota dealer in New York voiced concerns about slow electric vehicle sales, noting that steep discounts have been necessary to clear out inventory. The U.S. and EU are tightening trade measures in response to China’s dominance in the EV export market, further complicating the competitive landscape.
In light of these global shifts, the auto industry is accelerating its restructuring efforts. General Motors, for example, is focused on securing its battery supply chain by reevaluating its partnership with Honda and expanding its cooperation with Hyundai. Experts warn that unless automakers can produce EVs priced below $30,000, the stagnation in the EV market may persist for a long time.
Toyota’s recent decision is interpreted as a strategic choice to adapt to these global industry trends. However, Toyota remains committed to its long-term EV investment strategy, stating that its fundamental goal to expand EV investments remains unchanged.
Most Commented