In a significant shift in strategy, Toyota has delayed the launch of its electric vehicle (EV) production in the United States due to decreasing global demand for battery-powered cars. Originally, the Japanese automaker aimed to begin production by late 2025 or early 2026. However, a company spokesperson has now indicated that U.S. EV operations are expected to commence at an unspecified time in 2026.
This decision aligns with a broader trend in the automotive industry, as several major manufacturers, including Volvo and Ford, have recently revised their EV ambitions. "We’re still focused on our global [battery electric vehicle] target of 1.5 million vehicles by 2026," stated Toyota spokesperson Scott Vazin. He added that in the coming two years, the company plans to introduce five to seven battery electric vehicles to the U.S. market.
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| Toyota delays U.S. EV plans amid slowing demand. |
Earlier this year, Toyota announced a $1.3 billion investment in its Kentucky factory to produce a three-row electric sport utility vehicle (SUV). Additionally, plans are underway to develop another electric model at a plant in Indiana. To bolster these initiatives, Toyota is ramping up lithium-ion battery production with a factory set to open in North Carolina next year.
The announcement comes amid a challenging landscape for the global car industry, which is facing waning demand for electric vehicles in key markets. Recently, Tesla reported quarterly figures that fell short of Wall Street expectations, raising concerns about the leading EV manufacturer potentially experiencing its first annual delivery decline.
Volvo has also revised its previous goal of exclusively producing fully electric cars by 2030, citing changing market conditions and indicating that it will continue to offer hybrid vehicles. Ford, too, is reassessing its EV strategy, having scrapped plans for a large all-electric SUV and delaying the launch of its next electric pickup truck. Chief Financial Officer John Lawler attributed these adjustments to "pricing and margin compression" affecting the company.
As the automotive landscape continues to evolve, Toyota’s cautious approach reflects the complexities of navigating a market that is increasingly unpredictable.
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