The EV Slowdown Has Caused Toyota to Alter Its Stance Once More | Carscoops

      Toyota's second postponement regarding its Fukuoka battery plant points to more significant challenges in the EV sector as declining demand necessitates a reevaluation of strategy.

      The automaker must initiate development within three years of acquiring the land, having already reduced its global electric vehicle sales forecast. This year, the brand's EV sales have risen by slightly over twenty percent.

      For the second time this year, Toyota has delayed its plans to establish a new factory focused on EV batteries in Japan’s Fukuoka Prefecture. While this decision was anticipated, it underscores the company's cautious stance amidst changing global demand for electric vehicles.

      Although sales of Toyota's EVs have diminished, the automaker remains committed to progressing with the plant eventually.

      Toyota invested approximately 6 billion yen, equating to around $39 million, for property situated in a developing industrial zone in northeastern Fukuoka Prefecture. As part of the agreement, the company is obliged to commence construction within three years.

      Earnings Results Affect the Schedule

      Despite these commitments, the manufacturer announced in March that work at the site would be deferred due to reduced demand for its EVs. The governor of Fukuoka and Toyota President Koji Sato have confirmed that work has been postponed for a second time.

      Production was initially expected to begin in 2028, though an updated schedule has yet to be disclosed, as reported by Nikkei Asia.

      The announcement of the delay coincides with Toyota’s recent earnings report, which revealed a 10 percent reduction in its global EV sales projections, down to 277,000 units for the fiscal year ending March 2026.

      Nevertheless, Toyota has not dismissed the possibility of modifying its long-term goals, including its target of reaching 1.5 million global EV sales by 2026, a figure that may adapt to changing market conditions.

      Toyota Remains Committed to EV Investment

      Importantly, Toyota continues to heavily invest in new electric vehicles and manufacturing facilities. The company is also working towards launching a new factory in Shanghai, China, around 2027, to produce EVs for Lexus, which is expected to manufacture the LF-ZC and LF-ZL, concepts introduced a couple of years ago.

      During the first nine months of the year, Toyota's EV sales increased by 20.6 percent to 117,031 units, though this total still fell short of expectations.

      Until the company can be assured of significant sales growth, it is prudent not to accelerate the construction of new plants that could operate below capacity or remain idle.