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Toyota to Change EV Strategy in Bid to Catch Tesla: Report. It Better Hurry.

Through October, Toyota had sold just 14,421 battery electric vehicles in 2022.

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Courtesy of Toyota

Toyota Motor
has been slow to develop all-battery electric models. Now it wants to pick up the pace, and suppliers will be key to its efforts.

Sunday, Reuters reported that auto company Toyota (ticker: TM) will outline its changing EV strategy to its supplier base in an effort to improve its offerings relative to EV leaders
(TSLA) and BYD (1211. Hong Kong).

Toyota didn’t immediately respond to a request for comment about the report.

Through October, the latest data available, Toyota has only sold 14,421 battery-electric vehicles around the world in 2022. BYD sold 685,286 over the same span. Tesla doesn’t report monthly deliveries, but shipped 908,583 battery-electric vehicles in the first three quarters of the year.

Toyota is big in hybrid electric vehicles. The company sold almost 2.2 million hybrids through October.

That’s impressive, but the Chinese car market illustrates Toyota’s problem. Hybrid vehicle sales in China, the world’s largest market for new cars, are still growing, but battery-electric vehicle sales account for roughly 75% of all electrified vehicle sales in China. All-battery EV sales are eating into traditional car sales, becoming a huge portion of the Chinese market. Roughly one-quarter of all passenger vehicle sales in China in November were battery electric in November.

Toyota, for now, isn’t really participating in that market segment. It needs to speed up the development of battery-electric vehicles to preserve the market share of its total EV business.

Investors will have to watch out for announcements from Toyota to determine if the quality and cadence of its EV development is improving.

Toyota’s U.S.-listed American depositary receipts were trading 0.5% higher in the premarket session on Monday.
S&P 500
Dow Jones Industrial Average
futures were both up about 0.2%.

So far this year, Toyota’s ADRs are down about 23%. Rising interest rates and inflation have hit car-related stocks harder than most this year. The Dow is down about 9% so far in 2022.

Write to Al Root at allen.root@dowjones.com

Credit: marketwatch.com

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