Strategies for electrifying vehicles as part of decarbonization efforts - Insights garnered from Toyota's 1st Half/2nd Quarter financial results Q&A session regarding their electrification plans
Toyota's Future Plans and Strategies Unveiled
In a recent financial briefing, Akio Toyoda, the CEO of Toyota, shared insights into the company's future business strategies, particularly focusing on vehicle electrification.
Toyota's next project is the Woven City, a prototype city of the future, announced by Akio himself. This city aims to explore the possibilities of a sustainable urban environment.
Akio also admitted that Toyota could learn from Tesla's overall business model and actions for the environment. He compared Toyota's approach to Tesla's using a restaurant analogy, suggesting that Toyota focuses on providing a complete dining experience, while Tesla focuses on the main dish.
The market for battery electric vehicles (BEV) is not exclusive to Tesla. Companies like Nio, BYD, Huawei, Xiaomi, and many more Chinese manufacturers are also involved in BEV development. Their strategies focus on technological innovation in battery systems and platforms.
For instance, Nio offers a novel battery swap approach for rapid range extension, while BYD emphasizes ultra-fast charging with its evolving Blade Battery and "Super-e-Platform" capable of charging up to 1000 kW, aiming to make EV charging as fast as refueling combustion cars. Tesla continues adjusting pricing and expanding production with incentives to maintain competitiveness.
Shigeki Terashi, Toyota's Executive Vice President, believes that customers will choose mobility based on surrounding conditions, level of regulations, and regional preferences. He stresses that the market and customer ultimately make the choice of the next-generation electrified vehicle.
Toyota has been making future investments in the area of C.A.S.E. (Connected, Autonomous, Shared, and Electrified) over the past three years. To achieve carbon neutrality by 2050, Shigeki discusses the need for a variety of technologies, including hydrogen fuel cells, battery electric vehicles, and hybrid vehicles.
He highlights that the allocation of electrified vehicles will gradually change over time, with the goal of achieving a world with zero emissions. Shigeki also suggests that the solution for the next-generation electrified vehicle may vary based on factors such as the way a customer uses their automobile, infrastructure, sources of energy, and government-related policy.
Toyota has established Toyota Research Institute Advanced Development (TRI-AD) and is proceeding to take a "software-first" approach to vehicle development. The company is also starting to generate profit from software updates, much like Tesla.
On November 6, Toyota held its interim financial results briefing. During this event, Akio Toyoda shared his remarks on Toyota's business strategies, including its vehicle electrification strategy. He emphasized that Toyota has over 100 million vehicles in operation in the real world.
Interestingly, Tesla is perceived as delivering larger corporate value than all Japanese automakers, with a market capitalization of around JPY40 trillion. However, Toyota's price has started to diverge, moving in a different upward direction from the general automotive segment.
In conclusion, Toyota is making significant strides in the electrified vehicle market, learning from competitors like Tesla, and investing heavily in technologies like hydrogen fuel cells, battery electric vehicles, and hybrid vehicles. The company's focus on providing a complete mobility solution sets it apart, as it strives towards achieving carbon neutrality by 2050.
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