Toyota reworking their entire EV strategy to better compete with the Americans

Apparently they realized that EV's are catching on way faster than they predicted last year....and that Tesla is way ahead of them when it comes to design and production efficiency for EV's.

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Exclusive: Toyota scrambles for EV reboot with eye on Tesla

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Oct 24 (Reuters) - Toyota (7203.T) is considering a reboot of its electric-car strategy to better compete in a booming market it has been slow to enter, and has halted some work on existing EV projects, four people with knowledge of the still-developing plans said.

The proposals under review, if adopted, would amount to a dramatic shift for Toyota and rewrite the $38-billion EV rollout plan the Japanese automaker announced last year to better compete with the likes of Tesla (TSLA.O).

A working group within Toyota has been charged with outlining plans by early next year for improvements to its existing EV platform or for a new architecture, the four individuals said.

In the meantime, Toyota has suspended work on some of the 30 EV projects announced in December, which according to the sources and a document reviewed by Reuters include the Toyota Compact Cruiser crossover and the battery-electric Crown.

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As part of the review, Toyota is considering a successor to its EV-underpinning technology called e-TNGA, unveiled in 2019. That would allow Toyota to bring down costs, the people said.

The first EV based on e-TNGA — the bZ4X crossover — hit the market earlier this year although its launch was marred by a recall that forced Toyota to suspend production from June. Production resumed earlier this month.

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The review was triggered in part by the realisation by some Toyota engineers and executives that Toyota was losing the factory cost war to Tesla on EVs, the sources said.

Toyota's planning had assumed demand for EVs would not take off for several decades, the four people said.

Toyota designed e-TNGA so that EVs could be produced on the same assembly line with gasoline cars and hybrids. That made sense based on the assumption Toyota would need to sell about 3.5 million EVs a year – roughly one-third of its current global volume – by 2030 to stay competitive, the sources said.

But sales of EVs are growing faster. Automakers globally now forecast plans for EVs to represent more than half of total vehicle production by 2030, part of a wave of industry-wide investment that now totals $1.2 trillion.

The person leading Toyota's EV review is Shigeki Terashi, former chief competitive officer, according to six people with knowledge of the work, including two people close to Toyota. Terashi did not respond to a request for comment.

Terashi's team has been designated a "BR" or "business revolution" group within Toyota, a term used for major changes including a revamp of its development and production processes two decades ago.

"What's driving Mr Terashi's effort is the EV's faster-than-anticipated takeoff and rapid-fire adoptions of cutting-edge innovations by Tesla and others," one of the people said.

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Terashi could also propose to retire e-TNGA more quickly and opt for an EV-dedicated platform engineered from the ground up. That could take roughly five years for new models, two of the sources said. "There is little time to waste," said one.

Toyota is working with suppliers and considering factory innovations to bring down costs like Tesla's Giga Press, a massive casting machine that has streamlined work in Tesla plants.

One area under review is a more comprehensive approach to an EV's thermal management - combining, for example, passenger air conditioning and electric powertrain temperature control - that Tesla has already mobilised, the sources said.

This could allow Toyota to reduce the size and weight of an EV battery pack and cut costs by thousands of dollars per vehicle, making it a "top priority" for Toyota suppliers Denso and Aisin, one of the sources familiar with the matter said. Denso (6902.T) and Aisin (7259.T) had no immediate comment.

The recognition within Toyota, the world's biggest automaker, that Tesla has set a new benchmark for EV manufacturing costs marks a major reversal.

A decade ago when Toyota took a stake in Tesla and the two collaborated to produce a battery-electric version of the RAV4, many Toyota engineers believed Tesla's technology was no threat, two of the sources said.

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Toyota admits that this:



Can't compete with this:


Not in just performance, but also production costs. So...Toyota is throwing out the EV plan they unveiled just last year and starting over.