Toyota’s New EV Plan to Dominate the Market Has Been Revealed
Toyota knows that to compete with the likes of Tesla they need a new EV plan. Their top supplier recently revealed the details.
About a month ago we reported that Toyota was going to scrap their current EV plan. They are not moving away from EVs of course. However, the way they are currently built, and their performance will not allow them to compete with EV leaders such as Tesla. At the time we were unsure what the new strategy would look like. And to be clear Toyota has still not formally announced the details of the plan. But their top supplier Aisin recently posted a document called “Aisin Sustainability Briefing 2022” and it details what Toyota has planned through 2030.
An informative video regarding this was recently posted on the Kirk Kreifels YouTube channel. Some key areas are highlighted in this video around the new EV plan that Toyota is likely to follow. It covers items such as new generations of E-Axles, a possible EV Tundra, and a significant investment in North America. The groundwork is being laid now but most of the major innovations will be rolled out between 2025 and 2030. By 2030 most of the current generation Toyota EVs will be phased out. There is a lot of detail in this video, and we are not going to regurgitate it all here. But we do want to hit some highlights and try to understand what it all might mean for the future of the company. So, let’s get into this.
Efficiency Gains
One of the key aspects of the new EV plan is to increase the efficiency of the EV models. Toyota will take a 4-prong approach to that. Prong one is to introduce a second and third generation E-Axle. Prong two is to add additional aerodynamic devices. The third prong is improved cooling which will reduce power consumption. And finally improved regenerative braking. Overall, the expectation is that the vehicles will be 15 percent more efficient by the year 2025.
E-Axle
The E-Axle is a major component and deserves a bit more attention. The second gen E-Axle will be offered in small, medium and large sizes. These units are expected to be physically smaller yet more powerful and efficient. Of particular note is the new ‘High Output’ E-Axle for the larger vehicles. There is a small graphic next to it on the slide deck that shows an EV Tundra towing a trailer. The slide also says this unit will offer the climbing and pulling power compared to competitors with the same output range. So, will there be an EV Tundra be taking on the likes of the Ford Lightning, and electric Chevy Silverado? It sure seems like it.
Even bigger news is the third gen E-Axle which is expected in 2027. This generation is expected to be more powerful but also much smaller than the first-generation units. That will free up all kinds of room for passengers and storage. Or Toyota could decide to keep the cargo and passenger space the same but make the overall car smaller and even more efficient. This will be game changing technology.
The Future
Toyota expects to invest heavily in EVs and in North America with roughly 25 percent of the EV budget being directed here. And speaking of investments. The efficiency gains mentioned thus far are nice, but they don’t really address the elephant in the room. Batteries and the resources required to make them. There is a small note in the presentation that calls out that in 2025 there will be rapid charging and new materials and manufacturing methods will be used. Can that mean solid state batteries? Maybe. What we do know is with the push by all automakers to get EVs produced the nickel, lithium and cobalt required for the batteries will not be easy to come by. There is going to need to be another solution if we hope to scale EV production. Does Toyota have a solution?
Conclusion
Even though this new EV plan is not coming directly from Toyota we have high confidence that it will closely align with what they announce in the coming months. What does that mean for us? Do we wait to buy an EV until these much-improved models hit the dealers? Even if these improvements are realized will they be enough to get ahead of Tesla and other auto manufactures who have their own EV goals? That remains to be seen. But it does seem that Toyota has some aggressive goals in the not-too-distant future. It seems like the EV market is going to advance rapidly. And with the history of success that Toyota has had over the years, we would not bet against them.
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