Everything Keeps Going. Right? Toyota?

Toyota has been around longer than one tends to think. 86 years. Its origin is in the loom and weaving business.

Sakichi Toyoda sold the production rights to the world’s first automatic loom for 100 000 pounds in 1929 (approx. R171 million in 2023), He gave the proceeds to his son Kichiro to start building cars. In 1937 Toyota Motor Company had its first passenger car the Model AA. What they lacked in imaginative naming, they made up for in innovation, quality, and value-for-money products.

In 1997 they launched the Prius – a hybrid that made everyone take notice and wonder whether this ground-breaking, low-emission car was sounding the death knell for internal combustion engine (ICE) vehicles.

Worldwide, Toyota tops sales, they were the best-selling brand in 2019, 2020, and 2021.*

Toyota in SA

In South Africa, Toyota – also the top-seller – recently passed the 60-year mark. And its mark has been indelible on the motoring landscape. They launched vehicles that formed the backbone of family transport, urban commuter mini-buses, and farm workhorses. Corolla, Hi-Ace, and Hi-Lux have become parts of the language as well as benchmarks for excellence.

As part of their 60th celebrations, they produced a heart-warming video about: “Us moving South Africa, and South Africans … (meaningful pause) … moving us.” Unfortunately, their celebrations were hampered by severe flood damage to the Toyota plant in Durban. Unfortunately, it was also marred by Toyota SA’s lack of commitment to producing EVs.  In a statement on their website Glen Crompton, VP of Marketing TSAM, says generic politically correct things such as: playing a positive role in societycontributing to social developmentcreating jobs … and … working in harmony with nature.

Creating carbon-emitting vehicles is neither harmonious with nature nor sustainable. When it comes to sustainability he says: “Our approach to sustainable development is aligned to the Toyota Global CSR policy and guiding principles”.

And that’s the problem.

Since launching the Prius Toyota’s been hesitant to commit fully to  EV production. Whereas other manufacturers have committed to phasing out ICE vehicles in the 2030s, Toyota is committing to producing 3.5 million EVs by 2030 – approximately 33% of current sales. Their motivation is that they are not convinced full EVs are the only solution.

Toyota became the foremost automaker by making good business decisions. And by acting nimbly and innovatively when large US automakers dithered. So perhaps their cautious attitude may prove to be the correct one. But if they are wrong it may prove disastrous. Consider that BYD in China produced 110 000 EVs in December. At that rate, they will produce 7 million-plus EVs by 2030, and Toyota will have a hard time catching up. Then consider that Tesla sold 1.3 million EVS in 2022 – easily on target to have sold 7 million by 2030. Hyundai has set a target of 3.23 million vehicles per year by 2030. Many other leading brands are following suit. There is a worldwide belief that switching to EVs is the right thing to do, and there is an urgency to set deadlines for getting it done. An urgency that Toyota does not seem to share.

Akio Toyoda

CEO Akio Toyoda – grandson of founder Kichiro, race car driver in his youth, and self-professed petrolhead – is under pressure to preserve Toyota’s status as the leading automaker. The wait-and-see strategy has been taken under his watch. He is stepping down as CEO at the end of April 2023, but will still serve on the board.

Will the person taking over push for increasing EV production, or preserve the status quo?

Could it be that we’ll witness the demise of this great motor brand within the next decade? We will revisit Toyota as we track the EV trends. It’s going to get interesting.

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