Toyota said it will pour $35bn into a shift towards electric vehicles as the world’s biggest carmaker sets itself up for direct rivalry with Tesla and joins other groups in a push for carbon neutrality.
It marks a major increase in its electric targets as it aims to sell 3-5m battery powered vehicles annually by 2030, with the launch of 30 EV models by then in a line-up including sports cars and commercial vehicles.
The company has in the past argued that a longer-term fix for global warming should be a mix of hybrids, EVs and hydrogen-powered vehicles instead of a single bet on battery-powered cars.
But this focus has worried investors, who fear the group is dragging its feet on its electric plan, particularly as the technology has driven Tesla’s stratospheric rise in market value.
“I wasn’t interested in Toyota’s EVs until now. But now I’m interested in future EVs,” said Toyota president Akio Toyoda in a press conference.
Despite trailing Volkswagen and General Motors, some investors think now Toyota is stepping up electric sales targets, it could become formidable.
“They don’t make announcements like this unless they believe they can do it and want to do it. It tells me there is a high level of commitment,” said Christopher Richter, head automotive analyst at CLSA.
Although the figure trails the €52bn pledge on electric from German rival VW, it dwarfs the $17-7bn promised by Japanese rival Nissan when it unveiled its long-term EV strategy in late November.
The $35bn, which will be equally divided between car development and continuing investment in battery improvement, is also a significant increase since its last announcement earlier this year.
It had previously said it would sell 2m electric and fuel-cell vehicles combined by 2030 and spend $13bn in batteries.
Toyoda said the company’s high-end Lexus brand would be at the forefront of the company’s more aggressive battery push, with all of these models becoming pure electric by 2035.