Toyota Chair Speaks the Charged Truth About EVs

“It is regular users who are the ones who suffer” when government regulations try to shoehorn buyers and automakers into EVs, according to Toyota chairman Akio Toyoda. Speaking publicly as the head of the Japan Automobile Manufacturers Association, Toyoda said, “People are finally seeing reality” as sales growth sputters.

“I have continued to say what I see as reality… if regulations are created based on ideals,” instead of real-world conditions, “it is regular users who are the ones who suffer.”

Toyoda served as the company’s CEO for 14 nearly years before being gently forced out and into the chairman’s role earlier this year. The reason? His continued insistence that “there are many ways to climb the mountain that is achieving carbon neutrality,” aside from government EV mandates. Whatever you think about the necessity of removing all the human-made plant food (IE, CO2) from the atmosphere, Toyota has for more than 20 years led the way in improving gas mileage with its popular lineup of hybrid vehicles.

Shortly before Toyodo’s departure, Fitch Ratings director Satoru Aoyama warned that “Toyota is not correctly responding to calls from the market to take a lead in electric vehicles.” Markets seemed to be responding then to the flood of easy government money that flowed from Presidentish Joe Biden’s ill-named Inflation Reduction Act, which actually was most of the Green Nude Eel in drag. The assumption was that Washington could boot-strap consumer demand for EVs.

The rubber has met the road, market-wise, and if EV sales aren’t exactly running on fumes, they’re decelerating at a time when D.C.’s incentives were supposed to accelerate sales.

Elon Musk is worth $28 billion less than he was before last week’s disappointing Tesla quarterly results were published. Profits are down and operating margins are way down after the electric carmaker was forced to cut prices to juice sales. Ford can’t sell the electric version of its top-selling F-150 pickup and has laid off 700 workers at the Dearborn, Mich., plant that produces it.

“Toyoda has long advised the industry to hedge its bets on EVs, Fortune reported, “by continuing to invest in hybrids, hydrogen-powered cars, and other alternative eco-friendly vehicles.”

ASIDE: I don’t own and have never owned a Toyota. I’m regretting that right now.

Ford’s executive chairman, Bill Ford, told the New York Times last week, “Some of the red states say this is just like the vaccine, and it’s being shoved down our throat by the government, and we don’t want it.”

Well, he’s right. The Biden administration’s new CAFE environmental rules will make it impossible to produce a gas-powered car at a price consumers can afford to pay. California and other states have flat-out decreed that new gas and diesel vehicle registrations will end in 2035, not much more than 11 years from now.

Both Musk and Toyoda agreed in 2020 that full electrification won’t work. “The more EVs we build, the worse carbon dioxide gets,” Toyoda warned back then. “When politicians are out there saying, ‘Let’s get rid of all cars using gasoline,’ do they understand this?”

Toyoda has been the one who was right all along. Every time I pay $3.50 a gallon, even now that peak summer demand is long over, I wonder if I shouldn’t have paid more upfront for the hybrid version of my Jeep.

There are plenty of things to like about electric vehicles. When I first read that a Tesla has just 18 moving parts between the battery pack and the road, all I could think of were all the parts that would never break or wear out — because they don’t exist. But that doesn’t mean that electric is always appropriate. Range varies a lot with the weather and how much you need the heater or A/C. And as one Ford F-150 Lightning teser learned to his comic dismay, EVs just can’t tow.

Akio Toyoda knew all this and, most importantly, had the guts to say so in public and to smartly position his company when everybody else was going all-in on all-electric.

He got sidelined for that by his own company, but he continues to speak the truth.