Why Toyota Is Intentionally "Falling Behind" On EVs

When you go to buy a car, most carmakers today give you two options Gas or electric. But there's one exception. This is a graph of how many hybrids each car company sold in the U.

S. from 2020 to 2022. And this is Toyota As of 2019, about 60% of hybrids on American roads were made by Toyota.

But on the EV front, it looks like they're falling behind. Some people think they're making a grave mistake. But it's been part of their plan all along.

I went really deep into this. I went across the country, talked to every person I could. Hey, welcome to Toyota.

We're going to the electrified zone. . .

get to the bottom of why Toyota is doing this. And if they’re right. Oopsie, we can't sell any cars.

And I think I have an answer. This is what I found. To understand why Toyota came to the strategy it has now you have to follow its track through electrification.

It's the early 1990s and people were loving driving their gas guzzlers all over the place. But they're also realizing an undesirable byproduct of these cars. And scientists and governments and companies are really starting to say this is a problem.

One such group was the California Air Resources Board. they put out this mandate in 1990 that said, by 1998, 2% of the vehicles, every major auto manufacturers sold had to be an EV or no emissions. so just in time for the deadline, Toyota takes one of its most successful models and puts an electric battery in it.

And in 1997, Toyota releases only in California, zero emission, pure electric, Toyota Rav 4 EV just one of our many environmental solutions. just under 1500 of these beasts hit the road. One of them being driven by a special castaway.

I'm saving America And other car companies follow suit. Ford makes this weird little bug and a pickup truck into an EV. And GM makes this hot rod.

People loved this thing. So by the late nineties, early 2000, a bunch of Californians are driving around in EVs and lots of people like them. But then things turned weird.

Over the next two years, despite seemingly strong demand, almost all of these EVs are pulled out of the market and many of them are literally crushed. As you can see in this documentary, Who Killed the Electric Car. Ladies and gentlemen.

That's the sound of a crushed automobile being shredded into a million pieces. Then in 2000, GM, who owns the patent on the batteries inside most of these cars, sells the patent to an oil company. And this oil company then gets bought out by Chevron.

Then basically soon as Chevron gets its hands on this patent, they sue Toyota, one of the last remaining companies still using this battery for patent infringement. Chevron, an oil company that likes oil company, things like gas cars existing, tells Toyota and its battery manufacturer Panasonic, no more big batteries. Immediately, Toyota's plans to make plug-in cars were squashed.

Except there was one thing Chevron still allowed. The Prius! Right as Toyota was making its RAV4 EV, it also put a smaller battery into another car.

. . The Prius!

It still uses gas to run, which might be why Chevron lets this one slide but also has an electric motor that converts energy from the gas engine spinning to a battery which lets the cargo electric part of the time. This gives it a way longer range and uses less gas. And despite still having a significant amount of emissions, the thing is marketed like it's a tree.

In 2000, the Prius hits global markets and people love it. Prius. Yeah I have a Prius It spawns the car environmentalist movement and the model makes a meaningful reduction in carbon emissions coming from gas cars, which is great until EVs come back In 2008, Tesla restarts the electric market with its slick Tesla roadsters and the competition starts taking EVs seriously again.

But Toyota doesn't. In fact, it doesn't sell another full EV in America until 2022. Instead, it sticks to what becomes its tried and true.

The hybrid Toyota takes up a huge portion of the hybrid market and keeps adding more hybrids to its lineup. But as we come to today, as more car companies are rolling out more EVs, Toyota still only has one fully plug in EV. So people are saying Toyota is behind the curve.

So right now I’m at the LA Auto Show in Los Angeles and every big car company has their own new model that they want to show. And the big stuff that I'm seeing this year is, well, I actually haven't been here in the past, but the big stuff that I'm seeing is electric, Also, a lot of dads inspecting prospective trunks. But a lot of electric cars.

So Toyota has done a nice job of putting all these trees in their display to make it seem like they're really, really green, even though they're taking the longest to actually go fully electric Despite having an entire electrified section, Toyota only has one battery electric vehicle and its name seems like they didn't even want to sell it. And they didn't really. In the first three quarters of 2023 in the U.

S. , they sold 6486 BZ4X’s compared to 103,000 RAV4 hybrids and 27,000 Priuses. And that's their only fully battery electric car, though they say they'll release more soon.

as much as these trees might make you think Toyota's in on electric, they're actually actively fighting EVs. Like in 2019, they filed a lawsuit against California and their ongoing requirements to make EVs. So I think it's clear Toyota is into all in on EVs.

But why? It's all in here. This is an internal corporate document sent to Toyota dealers across the country.

In it, It says Toyota is committed to reducing carbon emissions as much as possible as soon as possible. it says that's going to be really hard on a wide scale because of three reasons. Number one, critical minerals.

Toyota says there just won't be enough materials like all that. Lithium from James's great video In the middle of nowhere. to meet the demand for EVs in the coming years.

Number two, charging infrastructure. Toyota says there just aren't enough chargers and they aren't fast enough. And number three, affordability.

They're still just too expensive. So instead, they offer this practical path forward, which is basically hybrids doing this. Toyota says it can use the materials from six battery EVs to make 90 hybrids and have 37 times as much carbon reduction.

Now, the company has announced its fleet of electric cars they plan to release in the next few years. But in the meantime, while the EV kinks are getting worked out, Toyota is betting on hybrids. So great sound strategy, right?

But you do have to remember, this is a marketing pamphlet that kind of seems like it was meant to get leaked. there's definitely validity to some of these claims. For example, there is a huge charger imbalance.

California has 14,000 charging stations, more than a quarter of the entire country. But Ohio, for instance, has just 1200. That's almost 10,000 people per charger compared to California's 2800 people per charger.

And some EV’s are still just too expensive for the common person. In July of 2023, Kelley Blue Book reported that the average EV sales price was about $5,000 more than a gas car. I got a car for under ten grand used.

It's like I couldn't buy an all electric for that. But some environmentalists argue Toyota is just copying out and trying to sell more cars and not invest fully in electric. they're going to be sitting there saying, oopsie, we can't sell any cars.

Now, maybe that's actually what they want. Maybe they just want an excuse to not sell EVs, which I think is the case for Toyota. Electric cars are still coming and are still going to be 100% of sales in, know, a decade or two.

So why would you slow down on the way there unless you want to save, you know, the 95% of your sales, But even if all of Toyota's claims are false, if they are affordable, the infrastructure is there and the car is on the lot. There's still the human element. And many Americans don't believe America is ready.

Some consumers don't know that a Tesla is an electric car, having to find a Tesla charging station was challenging. if Tesla is challenging, then I thought an electric car would be even more challenging because it takes much longer apparently to charge an electric car than it does a Tesla and this guy doesn't think climate change is real. they've said that the Earth is going to blow up and explode for umpteen years now, and we're still here.

So if And some people are just orange. Okay. So I just went into this Ford dealership.

they didn't want to be filmed. But what they told me was that EVs are just not the move in Cleveland. really annoyed that Ford keeps pushing electric cars and it might work in places like California.

But if you come to Cleveland, people just don't want to be on the road and run out of power in the And so this dealership doesn't even really sell EVs. The one guy was asking, What's the opposite of green? Because we're that we're orange.

While it might seem like EVs are everywhere. Only 31% of American adults say they're even somewhat likely to buy an electric vehicle as their next car. And the top reasons are concerns about a lack of charging stations, driving range costs and environmental impact.

And some companies are getting worried about that. Ford paused $12 billion of EV funding. And the CEO of Volkswagen, who's investing tons of money in EVs, says the roof is falling.

the former CEO of Toyota still seems to sleep well and says people are finally waking up to reality. Will Toyota win that reality? I guess we'll have to see.

But even if Toyota is some environmental laggard, they still have a lineup of EVs coming. And 30% of Americans say Toyota is where they'll look when they eventually do buy an EV. it's just a matter of time.