Japanese automaker Toyota has always had a keen eye for future trends. But in December 2022, Toyota President Akio Toyoda had mentioned that he was not too convinced by the auto industry’s shift towards electric vehicles (EVs). The veteran auto executive revealed that he has his doubts about the EV future and believes a vast majority of the silent industry insiders were also grappling with the same dilemma.
Although Toyota was a pioneer when it came to hybrids, with the world-famous Toyota Prius, President Toyoda’s comments rattled more than a few investors and stakeholders.
However, all that appears set to be changing. Toyota Motor Corp is set to undergo a sea change, in its lineup of cars and executives. The company will launch its next-generation fleet of EVs by 2026, under the Lexus name. Meanwhile, from April 1, Koji Sato will take over as CEO and lead the transition towards a sustainable future.
The change in senior management is expected to accelerate Toyota’s shift into an electric future and prepare the carmaker to roll out 30 EV models by 20230.
Toyota Chief’s Skepticism Over an EV Future
“People involved in the auto industry are largely a silent majority. That silent majority is wondering whether EVs are really OK to have as a single option. But they think it’s the trend, so they can’t speak out loudly,” Akio Toyoda said in December.
Toyoda was of the opinion that there must be a balance between EVs and other cars for the world to smoothly transition into sustainable energy. He recommended promoting hybrids and hydrogen-powered cars, alongside EVs to reduce pollution.
Toyoda has in the past pointed out the downsides of building EVs, as owners struggle to find charging points while manufacturers must contend with rising costs of lithium batteries.
While rival automakers have aggressively moved ahead with their EV plans, Toyota has adopted a more cautious approach. The Japanese manufacturer has invested in diverse ventures, including hybrids and hydrogen-powered cars.
The executive noted that green mobility can be achieved in various ways and the pressure to conform to EVs must not be feasible or sustainable. In 2021, the company had mentioned that it will spend around $35 billion on its EV lineup.
Electrifying Changes and an Ambitious Roadmap
Toyota’s plans for an EV future start with a change in leadership. Come April and the car manufacturer will have a new CEO and senior executives.
The Japanese automaker is making changes to address issues that have cropped up in its EV plans. As of April 1, Akio Toyoda will be succeeded as president and CEO of Toyota by Koji Sato, the president and chief branding officer of Lexus. Toyoda’s grandfather started the car business and the 66-year-old has led the company since 2009.
Other changes include the elevation of Hiroki Nakajima to CTO and Yoichi Miyazaki to CFO from April 1.
“We need to drastically change how we do business,” said Koji Sato. The Lexus executive has experience developing the first fully electric Lexus and working on hydrogen-powered cars, all of which fit into Toyota’s long-term strategy.
Sato blames Toyota’s hiccups regarding EV plans on a lack of communication. He compared his role to that of a captain of a soccer team. The would-be CEO mentioned that every individual will have a unique role to play while the captain is responsible for maximizing the team’s potential.
EVs made up less than 1% of Toyota and Lexus retail sales in 2022 through November. The new team has a long road ahead before they achieve carbon-neutrality and do away with gasoline guzzling monsters. By 2035, the luxury Lexus brand is set to go all-electric.
Previously, Toyota has stated that it wants to sell 3.5 million EVs annually by 2030. If that dream holds true, it is good to make a head start of the EV lineup with strategic collaborations and partnerships.
Industry observers note that the changes in top leadership will speed by EV-focused changes as Sato hinted that the company will need a “EV first mindset” to roll up to the top in EVs. The company will, however, take an omnidirectional approach, pursuing the roadmap laid upon by Sato’s predecessor.
