Toyota is quietly pushing Congress to slow the shift to electric vehicles

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Toyota is quietly pushing Congress to slow the shift to electric vehicles

The company was an early adopter of electrified vehicles but has since fallen behind

By Andrew J. Hawkins@andyjayhawk Jul 26, 2021, 12:05pm EDT


akrales_180328_2351_0621.0.jpg
Photo by Amelia Holowaty Krales / The Verge

The US is slowing moving toward adopting policies that would put more electric vehicles on the road, but for Toyota, it’s not slow enough. The Japanese automaker, which is the largest car company in the world, has been quietly lobbying policymakers in Washington, DC to resist the urge to transition to an all-electric future — partly because Toyota is lagging behind the rest of industry in making that transition itself.

According to The New York Times, a top Toyota executive has met with congressional leaders behind closed doors in recent weeks to advocate against the Biden administration’s plans to spend billions of dollars to incentivize the shift to EVs. The executive, Chris Reynolds, has argued that hybrids, like the Toyota Prius, as well as hydrogen-powered fuel cell vehicles should also be in the mix.

TOYOTA IS LAGGING BEHIND THE REST OF INDUSTRY IN MAKING THAT TRANSITION
In addition, Toyota is also pushing back against EV-friendly policy through the auto industry’s main DC-based lobbying group, the Alliance for Automotive Innovation. The group, which represents the major car companies and their suppliers and is chaired by Reynolds, has been arguing against the Biden administration’s plan to adopt the so-called California compromise as its official position, the Times reports.

Last year, a group of car companies made a deal on tailpipe emissions with California, which had been seeking to set tougher rules than the US as a whole. Under President Donald Trump, the Environmental Protection Agency had sought to strip California of its power to set its own emissions standards. But under Biden, that rule was reversed, allowing California and other states to impose tougher standards.

Toyota, which sided with the Trump administration in its battle with California, was not part of the original compromise. And the company has argued against EV-friendly policies in India and in its native country, Japan, as well.


Toyota’s behind-the-scene efforts to slow the momentum behind EV-friendly policies is surprising, given its status as an early adopter of battery-powered transportation. With the release of the Toyota Prius in 1997, the company helped pave the way for Tesla and others by proving that vehicles with alternative powertrains could be immensely popular. And more recently, the automaker has revealed plans to release 70 new models by 2025, including battery-electric, hydrogen fuel cell, and gas-electric hybrids.

But that doesn’t hide the fact that Toyota has fallen far behind its competitors, appearing content to rest on its laurels while the rest of the industry has lapped it several times. Companies like Nissan, General Motors, and Volkswagen have been selling pure battery-electric vehicles for years, while also revealing their plans to phase out gas cars completely. And Toyota’s failure to embrace EVs is not a new concept; The New York Times noted as much in this article from 2009.

TOYOTA’S TOP EXECUTIVES, INCLUDING BILLIONAIRE CEO AKIO TOYODA, HAVE BEEN ON THE RECORD CALLING THE TREND TOWARD ELECTRIC VEHICLES “OVERHYPED”
Toyota’s top executives, including billionaire CEO Akio Toyoda, have been on the record calling the trend toward electric vehicles “overhyped” in part because of emissions associated with power plants — which is a favorite talking point used by the oil and gas industry.

The company came under fire recently after it was revealed that it was the largest corporate donor to Republican lawmakers who objected to the certification of the 2020 presidential election. A majority of those politicians also dispute the scientific consensus on climate change. Toyota initially defended the contributions, but then later said it would halt them. You know things are bad for the company when a Toyota spokesperson has to confirm to the Times that the automaker does indeed believe that climate change is real.

Toyota’s argument that hybrids and fuel-cell vehicles should also be included in the conversation is not a bad one. Hybrid vehicles in particular are an important stepping stone to the wider adoption of EVs, especially as the charging infrastructure is still in its infancy.

But that argument might carry more weight if the automaker’s track record on fuel economy was actually, well, good. According to the EPA, Toyota has slipped in its ranking in fuel efficiency across its entire fleet, going from an industry leader to near the bottom with GM and Ford. This comes as the company has pushed the sale of huge gas-guzzling trucks and SUVs, which tend to command a larger profit than smaller sedans and hatchbacks.


SOURCE: THE VERGE
 
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Toyota bet wrong on EVs, so now it’s lobbying to slow the transition
Toyota has stepped up lobbying to preserve its investments in hybrids, hydrogen.

TIM DE CHANT -

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Toyota introduced the Prius Prime in 2016, years after other manufacturers released electric-only models.
Jonathan Gitlin

Executives at Toyota had a moment of inspiration when the company first developed the Prius. That moment, apparently, has long since passed.

The Prius was the world's first mass-produced hybrid car, years ahead of any competitors. The first model, a small sedan, was classic Toyota—a reliable vehicle tailor-made for commuting. After a major redesign in 2004, sales took off. The Prius' Kammback profile was instantly recognizable, and the car's combination of fuel economy and practicality was unparalleled. People snapped them up. Even celebrities seeking to burnish their eco-friendly bona fides were smitten with the car. Leonardo DiCaprio appeared at the 2008 Oscars in one.

As the Prius' hybrid technology was refined over the years, it started appearing in other models, from the small Prius c to the three-row Highlander. Even the company's luxury brand, Lexus, hybridized several of its cars and SUVs.

For years, Toyota was a leader in eco-friendly vehicles. Its efficient cars and crossovers offset emissions from its larger trucks and SUVs, giving the company a fuel-efficiency edge over some of its competition. By May 2012, Toyota had sold 4 million vehicles in the Prius family worldwide.

The next month, Tesla introduced the Model S, which dethroned Toyota's hybrid as the leader in green transportation. The new car proved that long-range EVs, while expensive, could be both practical and desirable. Battery advancements promised to slash prices, eventually bringing EVs to price parity with fossil-fuel vehicles.

But Toyota misunderstood what Tesla represented. While Toyota invested in Tesla, it saw the startup not as a threat but rather a bit player that could help Toyota meet its EV mandates. In some ways, that view was justified. For the most part, the two didn't compete in the same segments, and Toyota's worldwide volume dwarfed that of the small US manufacturer. Besides, hybrids were just a stopgap until Toyota's hydrogen fuel cells were ready. At that point, the company thought, hydrogen vehicles' long range and quick refueling would make EVs obsolete.

Yet, Toyota hadn't picked up on the subtle shift that was occurring. It's true that hybrids were a bridge to cleaner fuels, but Toyota was overestimating the length of that bridge. Just as Blackberry dismissed the iPhone, Toyota dismissed Tesla and EVs. Blackberry thought the world would need physical keyboards for many more years. Toyota thought the world would need gasoline for several more decades. Both were wrong.

In tethering itself to hybrids and betting its future on hydrogen, Toyota now finds itself in an uncomfortable position. Governments around the world are moving to ban fossil-fuel vehicles of any kind, and they're doing so far sooner than Toyota anticipated. With EV prices dropping and charging infrastructure expanding, fuel-cell vehicles are unlikely to be ready in time.

In a bid to protect its investments, Toyota has been strenuously lobbying against battery-electric vehicles. But is it already too late?

Hydrogen dead end
Having spent the last decade ignoring or dismissing EVs, Toyota now finds itself a laggard in an industry that's swiftly preparing for an electric—not just electrified—transition.

Sales of Toyota's fuel-cell vehicles haven't lit the world on fire—the Mirai continues to be a slow seller, even when bundled with thousands of dollars' worth of hydrogen, and it's unclear if its winsome-but-slow redesign will help. Toyota's forays into EVs have been timid. Initial efforts focused on solid-state batteries that, while lighter and safer than existing lithium-ion batteries, have proven challenging to manufacture cost-effectively, much like fuel cells. Last month, the company announced that it would release more traditional EV models in the coming years, but the first one won't be available until the end of 2022.

Confronted with a losing hand, Toyota is doing what most large corporations do when they find themselves playing the wrong game—it's fighting to change the game.

Toyota has been lobbying governments to water-down emissions standards or oppose fossil-fuel vehicle phaseouts, according to a New York Times report. In the last four years, Toyota's political contributions to US politicians and PACs have more than doubled. Those contributions have gotten the company into hot water, too. By donating to congresspeople who oppose tighter emissions limits, the company funded lawmakers who objected to certifying the results of the 2020 presidential election. Though Toyota had promised to stop doing so in January, it was caught making donations to the controversial legislators as recently as last month.

Toyota has also begun to wage a campaign of FUD—fear, uncertainty, and doubt—to cast EVs as unreliable and undesirable. "If we are to make dramatic progress in electrification, it will require overcoming tremendous challenges, including refueling infrastructure, battery availability, consumer acceptance, and affordability," Robert Wimmer, director of energy and environmental research at Toyota Motor North America, told the Senate in March.

Growth curves
While such FUD may have worked in the past when EVs were expensive and charging networks were sparse, it's less effective today and will probably be moot in a few years. Consumers aren't fooled, either. According to recent surveys, somewhere between 30 and 40 percent of consumers say their next purchase will be an EV. Some are following through with their decision sooner than later—plug-in vehicle sales in the US have more than doubled over the last year, compared with just 29 percent growth for the rest of the market.

Those two growth curves may sound familiar to former Blackberry executives. While Blackberry sales continued to grow after the introduction of the iPhone and Android devices—for several years, in fact—they weren't enough to save the company. The market had changed, but Blackberry didn't adapt quickly enough. Today, Blackberry's market share in handsets is effectively zero.

The automotive market changes more slowly than the mobile phone market, so Toyota still has a few years to right the ship. But its hurdles are higher—the company will need to deploy billions of dollars over several years to develop a new vehicle. Toyota seems unwilling to commit to EVs today, despite the signals the market is sending it. It's no wonder the company has resorted to working the refs.


SOURCE: arsTECHNICA
 
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"Toyota has also begun to wage a campaign of FUD—fear, uncertainty, and doubt—to cast EVs as unreliable and undesirable. "If we are to make dramatic progress in electrification, it will require overcoming tremendous challenges, including refueling infrastructure, battery availability, consumer acceptance, and affordability," Robert Wimmer, director of energy and environmental research at Toyota Motor North America, told the Senate in March."

How is this FUD? All perfectly true. Typical of the journalism of today.
 
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