Toyota has delayed plans to build electric vehicles in the United States by several months amid dwindling sales.
According to Nikkei Asia, production of a brand new electric three row SUV – the bZ5X – will commence at Toyota’s facility in Kentucky from the first half of 2026 instead of 2025.
The decision follows a $1.3 billion ($1.9 billion) investment in the facility from Toyota earlier this year.
The biggest losers: Toyota HiLux and Ford Ranger cop a hammering as cracks appear in Australian new-car market
Toyota winds back EV production ambitions amid global slowdown in EV sales
'We never say told you so': Toyota says the market has spoken on electric cars as EV sales flatline in Australia, while petrol-hybrids like the Toyota RAV4, Corolla Cross and Kluger soar
Nikkei Asia reported that Toyota said the decisions were made in part due to design adjustments.
Toyota also moved to scrap plans to build new electric luxury SUVs under the Lexus badge in North America by 2030 altogether. Instead it will likely ship vehicles to the market from Japan.
Toyota announced plans to slow its EV production last month as the brand cut its global EV production ambitions from 1.5 million to one million by 2026, a cut of roughly 30 per cent.
GM and Ford also made similar announcements earlier this year, with both brands citing a lack of domestic demand for EVs and increasing costs as the factors behind their decisions.
Hybrid demand continues to grow in the US, an area where Toyota has a strong advantage over the competition.
Toyota says it still plans to launch 10 EV models globally by 2026, with its overall outlook for the North American market remaining optimistic.
Under current US President, Joe Biden, Japanese automakers have been given strong tax incentives to invest in EV production in the United States. Honda also recently announced plans to build a new factory in Ohio.
There are concerns, however, that heavy tariffs on budget Chinese-made EVs in the United States and Canada could be stifling EV uptake and increasing costs.
Under new regulations in the US, Chinese-made EVs are slapped with a 100 per cent tariff, while Chinese-made batteries attract a 25 per cent tariff.
Tesla recently moved to cut its cheapest production vehicle on sale in the US market – the standard range, rear wheel-drive Tesla Model 3 – due to its battery cell technology being sourced from China, according to Reuters.
In Australia, Toyota's only EV on sale – the BZ4x – has been far from the brand's best seller, with just 717 units sold this year to date.
That compares to 43,232 units of the similarly-sized Toyota RAV4 hybrid, which has been Australia's top selling vehicle for the last two months.
.jpg)
