How Toyota Overcame the EV Decline

Toyota Chairman Akio Toyoda believes that electric vehicles will never occupy more than a third of the market. Photo: Kiyoshi Ota/Bloomberg

Talking Akio Toyoda looked a little bruised to Toyota employees last month.

The chairman of the world's largest automaker described how he was «beaten» by critics for refusing to deliver everything his company's chips in electric vehicles (EVs).

Instead, he has stubbornly advocated a so-called multi-pronged approach, covering electric cars, hybrids and even hydrogen-powered cars.

The decision has infuriated activists climate change team once praised Toyota for its eco-friendly Prius hatchback, but even industry insiders wondered whether the company was making a strategic mistake.

«It's very difficult to fight alone,» Toyoda told employees , according to a translation of his January remarks.

But now the industrialist's rivals are looking with envy at how slowing sales of electric vehicles have put his company in an advantageous position to benefit from a surge in demand for hybrids.

Toyota sold 10.3 million vehicles in 2023, up 7.7% from the year before.

The total includes 3.5 million hybrids and plug-in hybrids—up from the same period last year. an increase of 32%, but by just 104,000 electric vehicles.

For the year to the end of March, the Japanese giant forecasts profits of 4.5 trillion yen (£24 billion), up from 2.5 trillion yen previously .

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Yoichi Miyazaki, executive vice president of Toyota, said hybrids are selling well even in China, the world's largest market and producer of electric vehicles.

“As «Hybrids continue to be the preferred solution for our customers,» he told reporters.