TOKYO, June 13 (Portal) – Toyota (7203.T) will introduce high-performance solid-state batteries and other technologies to improve range and lower the cost of future electric vehicles (EVs), the automaker said Tuesday as a strategic pivot , which drove up the stocks.
The Japanese giant’s technology roadmap, which covers aspects as diverse as next-generation battery development and a radical redesign of its factories, came tantamount to the fullest disclosure of the automaker’s plan to compete in the fast-growing electric vehicle market it is in lagging behind competitors led by Tesla (TSLA.O).
The plan comes a day ahead of an annual shareholder meeting that will scrutinize governance and strategy — including a slow shift to battery electric vehicles under former CEO Akio Toyoda.
Shares of the world’s top-selling automaker rose 5% on the day to 2,173 yen, the highest since August.
Toyota announced plans to launch next-generation lithium-ion batteries by 2026 that offer longer ranges and faster charging.
The company also announced a “technology breakthrough” that addresses the durability issues of solid-state batteries, saying it is developing means to mass-produce these batteries and targeting commercialization in 2027-2028.
Solid-state batteries can store more energy than current liquid-electrolyte batteries. Automakers and analysts expect to accelerate the transition to electric vehicles by addressing a major consumer concern: range.
However, such batteries are expensive and likely to remain so for years to come. Toyota will hedge with higher-performing lithium iron phosphate batteries, a cheaper alternative to lithium-ion batteries that have fueled the adoption of electric vehicles in China, the world’s largest vehicle market.
For the higher end of the market, Toyota announced it would produce an electric vehicle with a more efficient lithium-ion battery that would offer a range of 1,000 km (621 miles). For comparison, the long-range version of the lithium-ion-powered Tesla Model Y, the world’s best-selling electric vehicle, can travel about 530 km by US standards.
An electric vehicle with a solid-state battery would have a range of 1,200 km and a charging time of just 10 minutes, Toyota said. In comparison, the Tesla Supercharger network – the largest of its kind – offers a charge of the equivalent of 321 km in 15 minutes.
Toyota did not provide any information on the expected costs or required investments for the plans.
The automaker’s engineers have been considering restarting its EV strategy since last year to better compete.
The roadmap detailed on Tuesday showed that Toyota, under new CEO Koji Sato, has adopted most of the conversion measures that engineers and planners have been developing as options for months.
This includes the use of electric axles and other technology from suppliers such as Aisin (7259.T) and Denso (6902.T).
“We want to change the future with BEVs,” said Takero Kato, president of Toyota’s new EV unit BEV Factory, in a video posted to the automaker’s YouTube channel on Tuesday.
NEW ASSEMBLY TECHNOLOGY
Toyota said it was developing a dedicated electric vehicle platform to drive down the cost of new models and a highly automated assembly line that would eliminate the assembly line system that has defined car production since Henry Ford over 100 years ago.
In Toyota’s “self-driving” assembly line, the cars in production would drive themselves through the process.
The company also announced it would use giga casting to reduce production costs and adopt an innovation developed by Tesla that uses massive aluminum casting machines to reduce vehicle complexity.
Koji Endo, senior analyst at SBI Securities, said he was surprised by Toyota’s move to offset Tesla’s lead in manufacturing efficiency. “I’m not sure yet if Toyota can retaliate in a counter-offensive, but they are preparing to try,” he said.
Toyota’s BEV factory, established in May, aims to produce about 1.7 million vehicles by 2030, Kato said — about half of the 3.5 million electric vehicles Toyota plans to sell annually by this year.
In April, the automaker sold 8,584 electric vehicles worldwide, including under its Lexus brand, accounting for more than 1% of its global sales in a single month for the first time.
Toyota sold nearly 10.5 million vehicles in 2022 and has a market value of around $254 billion. By contrast, Tesla sold an eighth as many vehicles but is valued at around $791 billion, a premium that reflects investors’ belief in Tesla’s growth potential.
Toyota has long stated that as the industry transitions away from gasoline-powered vehicles, it wants to offer consumers a choice of new-energy vehicles, including gasoline-electric hybrids and hydrogen fuel cells, as well as battery electric vehicles.
Reporting by Daniel Leussink; Edited by Christopher Cushing and Kevin Krolicki
Our standards: The Trust Principles.
Daniel Leussink