JAPAN REPORT
Toyota reportedly has partnered with China’s BYD to develop an affordable electric car to launch next year. The Japanese automaker has widely been recognized as a laggard in the transition to electric vehicles. Years of betting on hydrogen fuel cells and hybrid vehicles has put Toyota behind on battery-electric vehicles.
Reuters reports Toyota is planning to release a “small and affordable electric sedan” in China next year:
The electric vehicle is reportedly going to be powered by BYD’s blade battery cells with LFP chemistry. LFP chemistry has improved enough in recent years that it is moving from mainly being used in electric buses to now electric cars. BYD’s blade battery has attracted a lot of attention – even from Tesla, according to reports coming out of China. A Toyota source talking to Reuters said that it is what is enabling the automaker to produce its first affordable all-electric car:
The new electric vehicle will reportedly be slightly bigger than the Toyota Corolla and sell for less than 200,000 yuan (US$ 30,000). It’s not clear if the automaker plans to introduce the new electric vehicle outside of China.
Source: Electrek
PSR Analysis: I called Mr. Kenichiro Wada of the Japan Electrification Research Institute, a specialist in the Japanese EV industry, for his opinion on this report. The following is Mr. Wada’s point of view, which is very sharp and to the point, so I would like to introduce it here.
“The impact of this move on the industry will not reach a very large level. Currently, Toyota is mainly receiving battery supplies from PPES (Prime Earth EV Energy, a company co-founded with Panasonic) and CATL. As the EV market is expected to grow in the future, (methods) to procure batteries will have a significant impact on production, and this is where almost all automakers, not just Toyota, are currently focusing their efforts. Toyota’s collaboration with BYD should be seen as part of its efforts to increase its battery procurement channels, and this is like an insurance policy for Toyota to expand its battery procurement routes.
“Toyota is working on all aspects of hybrid, plug-in hybrid, EV, and FCV. But Toyota’s real intention is that hybrids, Toyota’s current strong point, will continue to be accepted by the market for a long time. And this expectation is being undermined in the market. Both Europe and the U.S. are moving to promote EVs and not allow HV sales in the future.
“Toyota’s market share in Europe is only about 6%, and even Toyota is almost incapable of influencing the decisions of the entire European market by one company. In an interview in early December, the CEO of Toyota Motor Europe indicated that the company plans to limit the cars it sells in Europe to zero-emission vehicles by 2035. This is a far cry from Toyota’s previous policy of promoting PHVs until EVs are widely available, and they appear to be in a hurry and rush.
“As for the developments regarding batteries, Toyota, like other manufacturers, is also investing heavily in all solid-state batteries and fuel cells, but the prospects for all solid-state batteries in particular are not promising at all. Since rare metals such as cobalt and nickel have been almost completely suppressed by foreign manufacturers, led by China, Japan, including Toyota, is developing battery technology that does not require rare metals.
“However, while technological advancement is important, what is really important is to find the right balance between supply and demand. Resources are currently very expensive across the board, but even if battery technology is developed that does not require these resources, it is important to know if it will contribute to the cost.”
While I cannot present all of Mr. Wada’s remarks here, I feel that his perspective is very solid and qualified. International competition is becoming very fierce in areas such as batteries and rare metals, but many of these issues are increasingly being decided politically by each country or region to protect its own auto industry, rather than on the basis of numerical accuracy, such as technological superiority or environmental impact. I am concerned about this.
We cannot ignore the political background to the collaboration between Toyota and BYD. There is a question as to whether this is the right course of action to truly contribute to users and the environment. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research
