Customers are "finally seeing reality."
With the sales of electric cars starting to slow down towards the end of 2023, carmakers have been dialing back their once-optimistic projections. General Motors and Honda, for instance, scrapped plans to work on affordable EVs together back in October.
Even with big inventories, fewer buyers are choosing to go electric for a number of reasons, including price and a lack of charging infrastructure.
Now, Akio Toyoda, chairman of Japanese carmaker Toyota, is doubling down on that pessimism, arguing during a business event earlier this month that the latest EV trends are warnings signs, with customers "finally seeing reality."
"The enemy is CO2," he argued. "No matter how much progress [battery] EVs make, I think they will still only have a 30 percent market share." The rest will be taken up by hybrid EVs and hydrogen fuel cell-powered cars, he argued.
It's a big vote of no confidence for plug-in EV dominance — though whether that hard-nosed strategy will end up paying off for the automaker remains to be seen.
Toyota has been bearish on electric vehicles and has been notably slow to adopt the technology, which has come to the disappointment of shareholders.
But now that EV sales are in a slump, the picture is starting to look different. The US EV market has struggled to maintain growth rates throughout 2023, despite record sales. China isn't faring much better, with EV adoption expected to slow down this year and analysts citing economic uncertainties.
Despite slowdowns, analysts are still expecting EV adoption to make sizable increases in 2024, including in China.
But predicting the global political climate, and how that could end up affecting the economy, remains as difficult as ever.
Toyota, though, is hedging its bets by arguing that its "multi-pathway" approach is the best way to achieve carbon neutrality.
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