Toyota Motor announced that it would spend up to 730 billion yen ($5.27 billion) to produce batteries for fully electric vehicles, a category of car that opponents claim it has been hesitant to adopt.
Toyota claimed its capacity to produce batteries in the 2 countries will have increased by 40 gigawatt-hours when the new facilities start up between 2024 and 2026, but it did not provide a current figure for comparison.
Toyota stated in a statement that the goal of the investment was to provide it the flexibility to adapt to the needs of its varied consumers in all nations and areas by offering a variety of powertrains and giving customers as many choices as possible.
The company should offer entirely electric (or “battery electric”) vehicles more quickly, according to certain green investors and environmental organizations, rather than continuing to rely on internal combustion engines in powertrain configurations like the hybrid.
Read more: Toyota bZ4X all-electric SUV hits the road at $42000
As the government opposes the use of gasoline and diesel vehicles and tightens the criteria for tax credits, Toyota is the latest in a long line of firms to announce significant battery investments in the United States.
Honda Motor Co., a significant rival, announced that it would construct a $4.4 billion lithium-ion battery plant for electric vehicles in the United States with LG Energy Solution Ltd., a Korean battery supplier.
Toyota announced that it would invest around 400 billion yen in Japan. With that money, the corporation would invest in two of its own plants, one owned by Prime Planet Energy & Solutions Co, a joint venture with Panasonic Holdings Corp, and a third plant that is now being constructed for a different joint venture with Panasonic.
Additionally, the Toyota Battery Manufacturing facility in North Carolina would get an investment of roughly 325 billion yen.
In response to stricter environmental restrictions, automakers worldwide are investing billions of dollars to increase the manufacture of batteries and electric vehicles.
In August, US President Joe Biden signed a $430 billion tax, health care, and environment plan, which would bar tax credits for electric vehicles made outside of North America.
Last Monday, California unveiled a plan to prohibit the sale of new vehicles using exclusively internal combustion engines by 2035.
Toyota pledged 8 trillion-yen last year to electrify its whole line of automobiles by 2030, with the development of completely electric vehicles receiving half of that amount. Even so, it projects that by the end of the decade, annual sales of these vehicles will only be at 3.5 million units, or about a third of their current number.
Less than two months after the model’s debut, Toyota announced in June that it has recalled more than 2,000 of the bZ4X SUV, its first mass-produced electric vehicle, due to the possibility that a wheel may come loose.