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Toyota finally admits ‘timing is right’ for an EV-first mindset amid business reshuffle

Amid new leadership changes, Toyota is reshuffling its business structure, claiming the “time is right” to accelerate battery electric vehicle (BEV) development. Toyota says it will take a new EV-first approach, starting with its luxury brand Lexus.

Last week, Electrek reported Toyota’s longtime CEO Akio Toyoda was stepping down from his position amid mounting pressure to accelerate EV development and keep up in a rapidly changing industry.

The news comes after the 66-year-old grandson to the company’s founder has been one of the most outspoken opponents of going all in on electric vehicles.

Toyoda insisted on sticking with a hybrid approach (including fuel cell, EV, hybrid, and gas vehicles) despite the industry moving forward with zero-emissions EV technology, putting the company on track to rank as one of the world’s most obstructive companies in 2022 with oil industry leaders.

After announcing his departure, Toyoda alluded to the fact that his successor will be tasked with leading the automaker’s transformation as it enters a new mobility era.

Incoming president Koji Sato is set to take the reins on April 1, 2023. Sato addressed the situation, saying Toyota will prove it’s committed to making cars better through “concrete actions and products, such as accelerating the shift to electrification.” He added the timing is now right to accelerate EV development with a new approach.

Toyota’s first electric vehicle, the bZ4X (Source: Toyota)

Toyota will accelerate EV development with new approach

Sato, previously the chief branding officer at Lexus, says he is looking to ramp up Toyota’s EV efforts with a new business structure and approach beginning in April.

In a press release Monday, Toyota announced it would implement several changes to transform the automaker into a mobility company.

First, Toyota will focus on electrification, claiming, “Toyota must create cars with energy security in mind and contribute to achieving a carbon-neutral society.” Sato added:

Now that the time is right, we will accelerate BEV development with a new approach.

Toyota plans to use its luxury brand Lexus to spearhead the approach with a full lineup of fully electric zero-emission vehicles by 2030. In particular, the automaker plans to make EV-specific parts like batteries and a dedicated platform to optimize and help expand its lineup and streamline production.

Lexus just revealed the price of its first EV, the RZ 450e, starting at $59,650 with up to 220-mile range.

Electrek’s Take

Top comment by t_newt

Liked by 16 people

I think Toyota may be serious this time. I had heard that their design group did a Hyundai Ioniq 5 teardown and were shocked at how more advanced it was than anything they had planned in their upcoming designs. They were also shocked at how much less expensive Teslas are to build. He said something in the press about needing to restart from scratch to design EV right to meet the competition. Soon afterwards CEO Akio Toyoda steps down as CEO (as some people would say, he was 'fired upward' to the Chairman of the Board).

I hope it isn't too late for Toyota, but, in any case, I think they may be on the right track now, and I'm now excited to see what they come up with in the next few years.

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After it was announced Sato would take over as president of Toyota, we questioned whether or not he could pull the automaker out of the past and into the modern era.

It seems that’s what he’s trying to achieve with the new EV-first approach. However, Sato still hinted at providing “diverse options” and stood by its “multi-pathway” strategy without getting too specific.

We’ve said it for a while now if Toyota doesn’t turn things around quickly and get on board, they will fall behind as the industry moves forward without them. Many automakers are already achieving double-digit sales (or 100% EV sales) while Toyota’s zero-emissions sales accounted for less than 1% of its total US volume.

Hopefully, Sato can get the new team on board. Otherwise, it will be a long road ahead for Toyota.

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Avatar for Peter Johnson Peter Johnson

Peter Johnson is covering the auto industry’s step-by-step transformation to electric vehicles. He is an experienced investor, financial writer, and EV enthusiast. His enthusiasm for electric vehicles, primarily Tesla, is a significant reason he pursued a career in investments. If he isn’t telling you about his latest 10K findings, you can find him enjoying the outdoors or exercising