Akihabara News (Tokyo) — The Ministry of Economy, Trade and Industry (METI) announced last week that Toyota Motor Corporation would be receiving a special taxpayer subsidy of about ¥118 billion (US$840 million) to develop cutting-edge electric vehicle (EV) batteries. It was a tacit admission of an enormous strategic misstep.
“I hope large-scale investments by Toyota and others will significantly strengthen our country’s battery supply chain,” stated METI Minister Yasutoshi Nishimura.
Soft-pedaled by the Japanese media was the obvious question–why should the world’s largest automaker, which possesses enormous resources, need to dip into the public purse for battery development at all?
The answer is that Toyota has spent long years dismissing the idea that EVs should or would become the main technology of the future. They largely squandered their lead in the past decades, scoffing at Tesla and other rising EV challengers.
Akio Toyoda, in particular, has long been adamant that hybrid internal combustion engines still have decades of dominance ahead of them, that hydrogen fuel cell vehicles have more potential, and that the EV evangelists are misguided.
But in last week’s annual meeting, all the headlines were about Toyota initiatives to develop and sell new lines of EVs. Toyota’s own shareholders have become restive about its EV skepticism, and some are even demanding more information about how the company has been lobbying around the world against government measures to address the climate crisis.
Abetted by a Japanese news media which is loathe to take on a national industrial champion–probably a key source of advertising revenues for most of them as well–Toyota looks like it is now trying to shift its long-held stance without being called out within Japan over its epic miscalculation.
But it is already too late. Chinese EV-makers such as BYD, SAIC, Geely, Nio, and XPeng are poised to become for global markets what Toyota itself was in the 1970s; the cheap, consumer-friendly, environmentally-responsible alternative which reshapes the automotive industry, making most of the older players look obsolete and out-of-touch.
EV charging stations and other infrastructure is becoming more robust in many nations. Countries are not building out fuel cell vehicle infrastructure on anything like the same scale.
Toyota will, of course, get a slice of the EV pie. In the current climate, it may also receive some benefits by playing on Sinophobic political forces. But as in almost every other industry, in automobiles as well there’s little reason to believe that Japan will continue to function as a top leader, but only as a niche middling power.
Recent Electric Vehicle Related Articles
Toyota Transformation Doubtful
High-Tech Cars Will Afeela Good
Clarifying Electric Vehicle Terminology