After years of cautiously navigating the electric vehicle (EV) market, Toyota is finally ramping up its commitment to fully electric vehicles.
The Japanese automaker, which has long relied on hybrids, is now planning to develop about 15 fully electric models by 2027, up from five currently. These models will include vehicles under the Toyota and Lexus brands, with production expected to reach 1 million units annually by that year, according to a report from Nikkei.
This strategy marks a significant shift for Toyota, which has thus far remained conservative in its approach to electric cars. The company sold just 140,000 EVs globally in 2024—representing less than 2% of its total global sales. Despite this, Toyota is aiming for a much larger presence in the EV market, targeting approximately 35% of its global production to be electric by the end of the decade.
The Nikkei report suggests the company plans to diversify its production footprint beyond Japan and China and expanding into the U.S., Thailand, and Argentina. This would help mitigate the impact of President Donald Trump’s 25% tariffs on all car imports, as well as reduce delivery times. Toyota is also building a battery plant in North Carolina.
For now, Toyota has only two fully electric vehicles on the U.S. market: The bZ4X and the Lexus RZ models. The Japanese automaker is expected to introduce new models like the bZ5X and a potential electric version of the popular Tacoma pickup.
Separately, Toyota and Honda, along with South Korea’s Hyundai, all announced on April 4 that they would not be raising prices, at least over the next couple of months, following the imposition of U.S. tariffs. According to a separate Nikkei report, Toyota’s North American division has told its suppliers that it will absorb the extra costs of parts imported from Mexico and Canada. Another 25% for automotive parts imported to the U.S. is slated to come into effect on May 3.