Toyota plans to significantly reduce its electric vehicle production, cutting its global output forecast for 2026 to 1 million vehicles, about 30% lower than its previous target, according to sources, reports Nikkei.
The decision to cut EV production reflects a broader slowdown in the global EV market, prompting Toyota to inform its parts suppliers of the adjustment.
Under the revised plan, Toyota aims to produce over 400,000 EVs in 2025, with plans to more than double production in 2026. In 2023, Toyota sold approximately 100,000 EVs, with around 80,000 sold from January through July this year. Despite the new 2026 forecast still representing a significant increase in EV sales, the production pace will be noticeably slower than initially planned.
Toyota’s earlier strategy, announced in May 2023, aimed to boost global EV sales to 1.5 million vehicles by 2026, setting a benchmark for scaling up its battery supply chain to meet expected market growth. However, the global EV market has cooled, with 2023 sales reaching 9.7 million units, a 32% increase from the previous year but down from the 65% growth rate seen in 2022.
Other automakers are also revising their EV strategies in response to the market slowdown. Volkswagen is considering closing a factory in Germany due to high EV investment costs, while General Motors plans to delay production of large EVs in Michigan by two years.
Ford has halted development of large electric SUVs, and Volvo has scrapped its goal to transition to only EVs by 2030. However, Honda remains committed to its EV strategy, maintaining its goal to produce only EVs or fuel cell vehicles by 2040.
It’s not easy making pure all-battery EVs and we’ve seen Toyota push their hybrids as the better solution, instead of pure EVs. Seems like only Tesla has cracked the code on being able to produce EVs at scale, while making a profit.
