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Power Transportation

Why Toyota Isn't All-In On EVs (cnbc.com) 373

During Toyota's annual dealer meeting in Las Vegas last week, which was called "Playing to Win," CEO Akio Toyoda explained why the company isn't all-in on electric vehicles. CNBC reports: Toyoda last week simply stated what he would like his legacy to be: "I love cars." Despite criticism from some investors and environmental groups, Toyoda this past week doubled down on his strategy to continue investing in a range of electrified vehicles as opposed to competitors such as Volkswagen and General Motors, which have said they are going all-in on all-electric vehicles. The plans could arguably cement Toyoda's "I love cars" legacy or tarnish it, depending on how quickly drivers adopt electric vehicles. "For me, playing to win also means doing things differently. Doing things that others may question, but that we believe will put us in the winner's circle the longest," he said [...]. Toyoda, who described Toyota as a large department store, said the company's goal "remains the same, pleasing the widest possible range of customers with the widest possible range of powertrains." Those powertrains will include hybrids and plug-in hybrids like the Prius, hydrogen fuel cell vehicles like the Mirai and 15 all-electric battery models by 2025.

Toyoda reiterated that he does not believe all-electric vehicles will be adopted as quickly as policy regulators and competitors think, due to a variety of reasons. He cited lack of infrastructure, pricing and how customers' choices vary region to region as examples of possible roadblocks. He believes it will be "difficult" to fulfill recent regulations that call for banning traditional vehicles with internal combustion engines by 2035, like California and New York have said they will adopt. "Just like the free autonomous cars that we are all supposed to be driving by now, EVs are just going to take longer to become mainstream than media would like us to believe," Toyoda said in a recording of the remarks to dealers shown to reporters. "In the meantime, you have many options for customers." Toyoda also believes there will be "tremendous shortages" of lithium and battery grade nickel in the next five to 10 years, leading to production and supply chain problems.

Toyota's goal is carbon neutrality by 2050, and not just through all-electric vehicles. Some have questioned the environmental impact of EVs when factoring in raw material mining and overall vehicle production. Since the Prius launched in 1997, Toyota says it has sold more than 20 million electrified vehicles worldwide. The company says those sales have avoided 160 million tons of CO2 emissions, which is the equivalent to the impact of 5.5 million all-electric battery vehicles. "Toyota can produce eight 40-mile plug-in hybrids for every one 320-mile battery electric vehicle and save up to eight times the carbon emitted into the atmosphere," according to prepared remarks for Toyoda provided to media.
Toyoda also said the company has no plans to overhaul its franchised dealership network as it invests in electrified vehicles, like some competitors have announced.

"I know you are anxious about the future. I know you are worried about how this business will change. While I can't predict the future, I can promise you this: You, me, us, this business, this franchised model is not going anywhere. It's staying just as it is," he told dealers to resounding applause.
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Why Toyota Isn't All-In On EVs

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  • by ickleberry ( 864871 ) <web@pineapple.vg> on Sunday October 02, 2022 @05:29PM (#62931573) Homepage
    All the other manufacturers are going all-in on EV but already now they are complaining about various material shortages. When they just started building cars in the late 1800s they weren't about to run out of various metals to create them. We have to get off the oil but there are other possibilities to make it work besides lithium ion + electric motor.
    • by klipclop ( 6724090 ) on Sunday October 02, 2022 @05:33PM (#62931575)
      Toyota doesn't want to kill all the small Japanese ICE parts suppliers and trying to lobby against EV regulations and timelines. Sounds like they're doubling down on the old dealer model too. Sounds like they're trying to scoop all their smashed eggs onto the old broken basket. None of their plan benefits consumers.
      • by whoever57 ( 658626 ) on Sunday October 02, 2022 @05:41PM (#62931585) Journal

        Toyoda doesn't want to be the person whose legacy is that he killed all those companies and his retirement is looming. This is him kicking the can down the road so they the next guy can trip on it.

        • by drnb ( 2434720 ) on Sunday October 02, 2022 @07:37PM (#62931763)

          Toyoda doesn't want to be the person whose legacy is that he killed all those companies and his retirement is looming. This is him kicking the can down the road so they the next guy can trip on it.

          No. This is him looking realistically at the science, the engineering, the infrastructure and the supply chain. None of these things move at the pace demanded by politics. All EV by 2035 is an example of a political timeline, not one based on reality.

          As we approach 2035, California will push the date back, or create exceptions, or otherwise adjust for reality.

          • You'd be shocked. Norway is already at 75% BEV market share right now.

            Sure, they're a bit richer on average but also much colder and more dispersed despite similar total area.

            • by drnb ( 2434720 )

              You'd be shocked. Norway is already at 75% BEV market share right now. Sure, they're a bit richer on average but also much colder and more dispersed despite similar total area.

              Yes, but they did so by choice. That tends not to artificially inflate prices like government mandates and other interventions that business can game to their advantage.

              Yes, it amazing what a wealth oil exporting nation can do when government corruption is low. But few countries can gain the necessary wealth from oil exports to indulge in such luxuries.

          • by AmiMoJo ( 196126 )

            So what do you think the limiting factors are?

            In Norway 78% of new vehicles sold this year have been EVs. Not hybrids, battery electric. Norway is a big country, with a harsh climate. Somehow they are managing it in terms of infrastructure and suitability of the vehicles. Their cut off for ICE sales is 2025.

            You mention supply chain. At the rate battery manufacturing is ramping up and being invested in, it seems unlikely that 12 years down the line there won't be enough available to meet demand.

            • Norway is an oil state much like Arabian countries, they have sufficient oil income to give all their residents a Tesla, Norway has actually been more wasteful with their revenues than Saudi Arabia. If oil falls off a cliff, those countries will be broke though, which a lot of Arabian countries are realizing and diversifying.

              Not every country has the revenue to simply give their residents a servant and a car and a house. In most countries like the US an EV still costs more than 2 minimum wage yearly incomes

          • None of these things move at the pace demanded by politics.

            No. They move at the pace demanded by consumers. (Be that consumers who are buying vehicles, or vehicle manufacturers buying parts).

            All EV by 2035 is an example of a political timeline, not one based on reality.

            The time between now and 2035 is longer than the time between now and the first viable EV hitting the market. That went through 8 years of doom sayers saying it was a dead end, or it couldn't be done. Until it was done. 10 years ago I laughed at the idea of a Tesla. Now basically every street in my suburb has at least one curb-side EV charging station (definitely outnumbering t

          • California will push the date back, or create exceptions, or otherwise adjust for reality.

            Most likely they will greatly increase the percentage of vehicles that can be plug-in hybrid (I think currently they have a 20% allowance). They should just treat all hybrid plugins the same as EVs, and just make a rule that the hybrid battery pack can go 50 miles on a charge (which would cover most daily commuting).

      • by Kernel Kurtz ( 182424 ) on Sunday October 02, 2022 @05:54PM (#62931605)
        Giving consumers a wide choice benefits consumers.
        • by trawg ( 308495 )

          A choice of ICE may soon not be a choice at all - if the regulatory environment is changing as dramatically as politicians are posturing at the moment, ICE cars are simply a dead end. Buying one is like when Google is launching a new product - risky to adopt and even riskier to bet the farm on.

          Don't get me wrong, it would be insane for Toyota to drop everything and go all-in on electric. But it's equally insane to me they are not focusing hard on an entry level small compact, like something in their Yaris r

        • Re: (Score:2, Offtopic)

          Isn't being alive more important than short term cheaper fossil-fuel cost?

          To prevent a 2C average increase and catastrophic tipping-point anthropogenic climate change, we need to emit less than 2.1 tonnes of CO2e per person per year in total [iop.org] in the short term, and 0 tonnes by the medium term.

          Average car use is 2.4 tonnes of CO2e per driver per year, just from the car [iop.org].

          2.4+everything else > 2.1.

          Electric cars average 1.15 tonnes of CO2e per driver per year, just from the car.

          The options are clear:
        • by AmiMoJo ( 196126 )

          Not the environment though, or the people suffering from the climate change created by fossil fuel vehicles.

          • Or the people suffering from the other kinds of pollution spewed by combustion engines right in the middle of densely populated areas.

      • by NFN_NLN ( 633283 ) on Sunday October 02, 2022 @07:59PM (#62931807)

        > "Toyota can produce eight 40-mile plug-in hybrids for every one 320-mile battery electric vehicle and save up to eight times the carbon emitted into the atmosphere," according to prepared remarks for Toyoda provided to media.

        Freakonomics came to a similar conclusion. Producing 1 car with 100% EV power is less effective than using the same amount of lithium to produce hybrid cars. If lithium is truly limited (and I believe it is) then is makes far more sense to give everyone partial electric power for a few kilometers.

        • by tragedy ( 27079 )

          Freakonomics came to a similar conclusion. Producing 1 car with 100% EV power is less effective than using the same amount of lithium to produce hybrid cars. If lithium is truly limited (and I believe it is) then is makes far more sense to give everyone partial electric power for a few kilometers.

          Less effective by what metric? If the metric is amount of lithium used, then duh! If it's some other metric, what was the math and what axioms were used?

        • by Hairy1 ( 180056 )

          Lithium isn't functionally limited. True we could reign in the amount of battery we put in EVs - perhaps to 250-300km max, as this is way more than most people use. This would reduce the cost, and perhaps put them under the ICE threshold. The main issue right now is production. Why make a cheap car when you couldn't build enough to meet demand? Better to make more expensive cars at first so you can meet demand. Eventually all the car companies will get onboard and prices will drop.

        • by steveha ( 103154 )

          Freakonomics came to a similar conclusion.

          I suspect Freakonomics performed a shallow analysis. IMHO EVs are a much better idea than hybrids. Maybe Freakonomics only was looking at the short term, not the long term? Hybrids make sense when the cost of batteries is super high, but IMHO don't make sense any longer (and are a terrible idea in the near future and afterward).

          I wanted an EV so I wouldn't any longer have a repair bill for a transmission problem, an emissions control problem, an oil leak, or any

        • If lithium is truly limited (and I believe it is)

          Lithium exists in abundance. Don't be that "peak oil" person from the 70s whom we are all laughing at.

      • Since when does consumer choice not benefit consumers? Oh yeah when there is a government mandate involved.
      • did you not read the part about metal shortages?
      • Toyota also operares on emerging(3rd world) markets that wont have charging infra for a while.

        Hilux is a best seller and will be for a long while more.

      • Let the customer decide what is useful to them. I wouldn't snort so loudly in Toyota's direction if I were you. They were the pioneers in hybrids and single handedly made them mainstream. They are well positioned to see both sides of the supply chain here.

    • by gweihir ( 88907 )

      That is nonsense. The manufacturing situation is entirely different than in the late 1800s.

    • When they just started building cars in the late 1800s they weren't about to run out of various metals to create them.

      Shortages are part of literally every boom industry and that includes motor vehicles in the past. Mind you when discussing complaining about availability of materials it's wise to not consider anything which has happened in the past 2 years.

      Ford right now literally can't get the materials to make the Ford badges that go on their cars. That's not an EV problem either. https://www.cnbc.com/2022/09/2... [cnbc.com]

      We're not about to run out of materials to make EVs. What we do have is a supply chain disruption due to an u

  • by SoftwareArtist ( 1472499 ) on Sunday October 02, 2022 @06:35PM (#62931657)

    About 15 years ago, Toyota decided hydrogen was the future and went all-in with it. That wasn't a crazy prediction. At the time, neither electric nor hydrogen was ready to be mainstream. Batteries were too expensive and had too little capacity, and hydrogen infrastructure didn't exist. It wasn't clear which would win out.

    Electric won out. That's been obvious for a while now. Batteries advanced faster than anyone predicted, while hydrogen infrastructure is still mostly nonexistant. But Toyota refused to admit it and stuck with hydrogen much longer than they should have. So now they're behind the rest of the industry, trying to give excuses why people should keep buying hybrids when most other companies have moved on. Seriously, you have a CEO still trying to sell hydrogen based cars while citing a lack of infrastructure for EVs? It's absurd.

    • Hydrogen is still a viable option, but only if there is infrastructural investment in solar/wind production of hydrogen (rather than using nat gas for it).

    • by AmiMoJo ( 196126 )

      15 years ago, 2007. Nissan was developing the Leaf for release in 2010. Turns out the assumption that batteries were too small and too expensive was wrong. Nissan actually built the packs itself back then too.

      I think it was obvious that hydrogen wasn't going to take off. LPG and other alternative fuels had existed for a while by that point, and failed to gain much traction. Lack of distribution and refuelling stations, neither a problem for electricity. Hydrogen was even worse, because it's difficult to sto

  • by williamyf ( 227051 ) on Sunday October 02, 2022 @06:42PM (#62931671)

    I can undesrtand why people living in countries like the USoA, China, Japan, the EU, Australia, the UK, Canda and the like may think that Fully Electric Vehicles are inevitable.

    But, as a Velezuelan, with friends in LatAm, India, and the Magreb, I can offer a different perspective...

    In Venezuela , the electrical infrastructure is not ready to the added demand to charge BEVs, we even have rolling blackouts, for crying out loud!
    Think we are an exception, not the rule?
    Take a look at Lebanon (the country of origin from my parents):
    https://www.reuters.com/articl... [reuters.com]
    And please notice that this article is from 2019, with cheap oil and gas, before Covid and the explosion in the beirut port...

    I've travelled through LatAm (is the same), my friends in the Magreb tell a similar story.

    What about India (5th largest economy in the world)? It paint a similar picture:
    https://www.aeaweb.org/article... [aeaweb.org]
    Again, 2016, Cheap oil, and long before Covid.
    Do you thinkn from 2016 to 2022 it got better?
    https://www.reuters.com/world/... [reuters.com]
    TL;DR: NOPE!

    Do you think all these countries will get their collective acts together by 2035 so they can madate ZEVs like California, NY, and many countries in Europe? My hope says yes, but my money says no.

    Do everyone lives in a house where they can install a charger? What about us plebs that live in apartments? How much a public charger will cost? Or the works to install a charger in our parking spots will cost?

    While I believe that BEVs are the future, my issue is with the word Inminent. Not even by 2035 will most of the world be ready for BEVs only.

    In that sense, Toyota's hybrid strategy is a winner. Make BEVs for developed markets, Make plug-in-Hybrids (if serial better, instead of the Prius' paralell hybrid krap) for less sophisticated markets, and make ICEs where electrification is simply not possible.

    Ah, and another thing, if any car maker is reading, and wants to help the environment (both air quality and global warming) ditch gasoline ICEs across all your range and go to 100% Natural gas cars.

    Why you ask?
    We need to keep extracting oil/petroleum, Otherwise, all those BEVs will not have tyres on wich to roll (the days of natural rubber are long gone), asphalt for the tarmacs, advanced composites to reduce weight, plastic of the insulation of the wire harnesses, lubricants for parts like the ball-bearings, insulating smalt for the wires inside the electric motors... and we humans would lack some important things (like medicines that involve oil derivatives)... and that oil/petroleum has natural gas asociated with it... since that natural gas has MANY times more greenhouse power than CO2, we need to burn it. I'd rather burn it in an ICE and get some work out of it, than burn it as a flare and get nothing...

    But wait! There is more! We also need to keep drilling for natural gas itself! Not because the natural gass associated oil/petroleum is not enough... no no no no... but because we need helium.. and all the helium is trapped beneath the earth in wells that also has... you guessed it, natural gas. No helium, no LArge HArdron Collider, no JAmes Webb Space Telescope, No MRI exams at your local hospital... a Shame really...

    All that natural gas that comes associate with the helium has many times more green house power than CO2, so we have to burn it. I'd rather burn it in an ICE and get some work out of it, than burn it flaring it and get nothing. Where did I hear that before? ;-)

    Trust me, I was born and live in the country with the biggest flare site on the planet (Lago de Maracaibo, Venezuela).

    So no, the whole world is not (and will be not for a long time) ready for BEVs, each an

    • by e432776 ( 4495975 ) on Sunday October 02, 2022 @07:01PM (#62931699)
      You nailed it with this:

      In that sense, Toyota's hybrid strategy is a winner. Make BEVs for developed markets, Make plug-in-Hybrids (if serial better, instead of the Prius' paralell hybrid krap) for less sophisticated markets, and make ICEs where electrification is simply not possible.

      And thank you for broadening the discussion a bit! I echo your sentiment that even in the US the situation is heterogeneous. Where I am we have 50c/kwh electricity, limited charging infra- BEVs don't make the most sense economically or practically, and adaption reflects this. Toyoda seems to think this variability will persist for a long time- and he may be right! Time will tell.

      • Some of your complaints are valid, but ... why are you complaining about 50c/kwh? Gasoline is significantly more expensive than 50c/kwh.
        • Gasoline is significantly more expensive than 50c/kwh.

          Maybe in countries where gasoline is very expensive. 50c/kWh electricity is very expensive.

          Gasoline has about 8.9 kWh/l. At $0.50/kWh, gasoline is worth about $4.45/liter in a theoretical 100% efficiency ICE.

          A modern, efficient ICE (e.g. Skyactiv) gets about 40% thermal conversion, bringing the equivalent value of the electricity down to $1.78/liter ($6.74/US gal) in terms of gasoline.

          An average efficiency ICE gets 25%, making the equivalent value $1.11/

      • Loosing the biggest and most profitable market is 'a winner'?
        I agree that in many parts of the world ICE will still be used for quite some time.
        Then again: we (Europe, Asia and North America) will need to get rid of quite a bit of ICE cars in the coming decades...

        If you would ask if Toyota is planning to give up on their main market (Europe, Asia and North America) in favor of this market that is winding down, I'm sure they will say: "No we will do both".

        Unfortunately: without putting absolute priority on c

    • South America is also a big ethanol market (see: Brasil). Ethanol-powered engines will be a thing there for awhile.

      • South America is also a big ethanol market (see: Brasil). Ethanol-powered engines will be a thing there for awhile.

        You are correct, but ethanol-powered-engines ARE A THING RIGHT NOW there in Brazil ;-)

        But remember, the brazilians need to burn their natural gas anyway (see: Petrobras), they would rather burn the gas in an ICE and get some work out of it, than burn it in a flare and get nothing ;-) That's why they do not cook with ethanol stoves, and have a healthy natural gas car market too...

        • That's what I meant. Ethanol engines and high-ethanol fuel blends have been prevalent for decades. That's not a market that will adapt quickly to EVs.

    • by kanda ( 624761 )
      You raise very good points, let me try and answer a few.

      I can undesrtand why people living in countries like the USoA, China, Japan, the EU, Australia, the UK, Canda and the like may think that Fully Electric Vehicles are inevitable.

      But, as a Velezuelan, with friends in LatAm, India, and the Magreb, I can offer a different perspective...

      This is predominantly a peak demand problem, thankfully EVs don't charge (and don't have to charge) during peak demand. While EVs will reshape the power generation, the additional power generation capacity is expected to be within 3 to 5% and energy share will be ~10%. See analysis for India [inc42.com].

      Do everyone lives in a house where they can install a charger? What about us plebs that live in apartments? How much a public charger will cost? Or the works to install a charger in our parking spots will cost?

      Charging in apartment will be the key issue to address, they way it is happening in India is common slow/medium speed cheap charges are getting installed. These ar

      • While share of renewable in power generation keeps increasing, nobody has a solution for 100% renewable and gas powered electricity plants will play a role. Similarly oil/petroleum will also be used where it makes sense in large hybrid vehicles, aviation and even power generation. Even if there is a decline in overall usage, it will be sufficient enough to meet the non-energy demands. I think it is coal which will (and should) decline.

        I think you're making an interesting point here: instead of burning natural gas in cars with the implied hazards, burning it in plants to produce electricity might be more efficient; so that everything converges to electric: gas, solar, nuclear, ...

        That said, I also don't see some parts of the world massively convert to EVs in the near future. I wouldn't actually have cited India since India has a very dynamic economy and the ability to move pretty quickly, but I'd agree Maghreb/South America are still far

    • No single change will be 'the solution'. The problems are too varied and complex. It's the aggregate of small changes that will make a huge difference, ie harm reduction model.

      If we waited for people to 'be ready' then it'd never happen. People like the status quo & stability vs some unknown future because change is scary. Future change is slightly less scary than "things are changing in the next few years".

      If we had waited until everyone is ready for solar, the price of installing solar panels would st

    • by AmiMoJo ( 196126 )

      You have rolling blackouts. So clearly your infrastructure needs a major upgrade. But EVs can actually help you here.

      Many EVs support vehicle to grid. You can run your house/business off the EV's battery. For days if necessary. If you have solar panels or a small wind turbine you can use it as energy storage.

      I the West people are already recycling EV batteries for use as stationary home batteries too. You can do it DIY, it's not all that hard. Maybe an opportunity for some business to get into recycling. Al

  • Toyoda reiterated that he does not believe all-electric vehicles will be adopted as quickly as policy regulators and competitors think, due to a variety of reasons.

    Granted, I own an EV and am all-in on it... but I think he is way off in his assessment (including the reasons offered). The transition is only limited by supply of EVs until you hit about the 80% penetration threshold. As you go above the threshold (whereever it may be), then you start to hit use cases where you need significant technology en

    • You may be right, in a US-centric view. Lots of countries aren't as close to ready for EVs as the US. Even the US has some serious challenges once adoption really picks up. For example, California's electric grid is nowhere near ready to support the strain of millions of EVs being charged all at once.

      https://www.kpbs.org/news/envi... [kpbs.org]

      Some of these problems of scale will soon become more starkly evident, and the solutions won't be easy to build out in just a few years.

  • by juancn ( 596002 ) on Sunday October 02, 2022 @07:33PM (#62931753) Homepage
    And because they do sell everywhere, many countries are not near ready for fully EV cars. The economics don't work.

    You would need 20-30 years of infrastructure investment to get there.

    EVs are way more expensive than regular petrol cars, typically closer to 2X that a cheap petrol car with similar specs, and in places where cars are considered luxury items, the more expensive cars fall in a higher tax bracket, making them even more expensive.

  • The EV silver bullet will be like all other populist silver bullets, nothing except to shoot the fanbois own feet with.

  • As they are correctly expecting, the solution is not jumping all in, but considering full value chain of the product. Material production, mining, getting rid of including. The solution they, policies, we all will arrive at hopefully in my life, but way past too late for solving global warming tipping point is creating everything to last as long as possible, be repairable as close to 100% as possible and producer taking responsibility for whole life of products materials recyclability. Not ownership, but re

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