Toyota Motor Corp.
laid out plans for spending $5.6 billion on electric-vehicle battery capacity, as it moves to catch up after expressing doubts about how quickly the world should shift toward EVs.
On Wednesday, Toyota said it planned to spend about $2.5 billion on scaling up production at a plant it is building in North Carolina. Another roughly $3 billion will be invested in plants in Japan as well as a facility operated by Prime Planet Energy & Solutions Co., a joint venture of Toyota and
Panasonic Holdings Corp.
Not all of the spending described by Toyota on Wednesday is new. Part of it was included in the ¥2 trillion, equivalent to $14.4 billion, that Toyota said last year it planned to spend on battery research and production, a spokeswoman said. She declined to give additional details.
Toyota said it planned to begin battery production in the U.S. and Japan within the next four years.
The Japanese auto maker was long a voice of caution about the transition to battery-powered cars but it largely reversed course in December. At the time, it said it would spend the equivalent of around $30 billion on EVs over the next decade. It said it aimed to sell 3.5 million EVs a year by 2030, up from an earlier target of around two million.
On Wednesday, Toyota said it wanted to “build a supply system that can steadily meet the growing demand” for electric vehicles.
President Biden has pushed car companies to bring more battery manufacturing to North America. To get a tax break under the recent U.S. climate and healthcare law, EV models must have a certain value of their battery components assembled in the region.
Toyota executives have continued to offer hedged comments about how quickly the EV transition will happen, with the industry hampered by shortages of minerals and materials that go into batteries for the vehicles. The auto maker views hybrid gas-electric vehicles as a good way to reduce emissions in regions of the world that lack sufficient EV infrastructure and burn fossil fuels to generate much of their electricity.
Jack Hollis, a top Toyota executive in North America, said in August that the EV marketplace isn’t mature enough yet and hybrid vehicles are likely a better near-term solution for many customers.
Toyota said it aimed to increase its annual battery production capacity by up to 40 gigawatt-hours in Japan and the U.S., enough for more than 700,000 vehicles based on the International Energy Agency’s estimate of average EV battery capacity.
Toyota shipped around 4,000 EVs in the recent April-to-June quarter, making up less than 1% of its total unit sales. Hybrid vehicles made up nearly 30% of Toyota and Lexus shipments for the period.
Toyota joins a growing roster of Japanese companies planning multibillion-dollar investments in their battery supply chains in the U.S.
Earlier this week,
Honda Motor Co.
said it planned to build a $4.4 billion EV battery factory in the U.S. in a joint venture with South Korea’s
LG Energy Solution Ltd.
supplier Panasonic has unveiled a similar-sized investment in Kansas and is considering an additional one in Oklahoma.
—Sean McLain contributed to this article.
Write to River Davis at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8