The world’s top automaker has all the tools and tricks to still stay ahead in the ‘parallel worlds’ of new-energy vehicles
These are truly exciting, often nerve-wracking, times to be engaged in the transport and mobility industries, as the human race attempts to wean itself away from its dependence on fossil fuels and take the first steps into the vast, unexplored realms of new (and hopefully renewable, sustainable, and clean) sources of energy.
The stakes are higher for the industries’ bigger players, of course, and perhaps none more so than what Toyota—the world’s top-selling automaker— is facing.
Prudently so, the Japanese carmaker isn’t putting all its edamame in one pod, so to speak. Despite the growing clamor to hasten and intensify its rollout of more battery-electric vehicles (BEVs), Toyota has reiterated it would explore and develop other energy sources, as well.
So, why take the “multiverse,” multi-faceted approach and not direct all their energies on the one type of new-energy vehicle (NEV) that’s about to become mainstream in many developed markets?
Their short answer is that not all vehicle markets are created equal. What works for one country wouldn’t work in another.
This was the crux of Toyota Motor Corp.’s October 12 online press conference held for Asian journalists bound for the Japan Mobility Show (formerly Tokyo Motor Show) that will begin on October 28 and conclude November 5.
Pras Ganesh, executive vice president of Toyota Daihatsu Engineering & Manufacturing, quipped that “there are no one size fits all” approaches to a complex problem.
He explained, “Toyota strongly believes that when it comes to electrification, and especially with the focus on the concepts of carbon neutrality, it’s not a single-size fits all. There are different customers, and each customer needs to be provided with the electrified alternative fuel solution that supports them. That’s the reason why we will be showcasing BEVs, plug-in hybrids, fuel cell EVs, and hybrid EVs (during the Japan Mobility Show). And each of these will also have a different flavor, which is to try and show, as a car company, how we can provide the experience of fun-to-drive or practicality or realistic lifestyle for every single person under the concept of ‘Mobility For All.’”
More integrated blend with society
This multi-faceted approach, Ganesh said, would be on full showcase in the mobility show. He mentioned some of Toyota’s inroads in research and development towards what can be described as a more integrated blending of mobility with human society. He said that the “intelligence of the vehicle itself (would play a significant role) in terms of connectivity, in-car multimedia, updates, safety, and autonomous driving. Also, (Toyota will show) how these will be integrated broadly with society.”
Another big reason to go for a multi-faceted approach, as Ganesh explained, was for the carmaker to gain a firmer foothold on an increasingly wider range and diversity of vehicles and customers.
“We want to show that, first, Toyota is not a car company that is only focused on a single niche. We’re not looking at just the luxury customers, or the first car buyers. We also don’t look at just passenger cars. We also look at the commercial vehicles. So, we provide diversification of vehicles that integrate with the diversification that we have of the customers themselves,” he said.
“Second, we must not only provide vehicles for individuals, but also provide shared mobility for people with, for example, physical disabilities. How do we provide mobility solutions that can give them a kind of freedom of mobility? So, it could be wheelchair-based services.
“Third is energy diversification. More and more we are integrating the vehicle with the energy source. If we’re really true to the real subject of carbon neutrality, energy becomes a critical element. The vehicle is just the medium in which the energy is transported. So how do we actually look at energy much more broadly so we’re also looking at energy diversification?”
Uniqueness of Asia
Ganesh explained at length the uniqueness of the Asian markets for Toyota. “In each of the countries we’re working on in Asia, the mobility requirements are completely different. A lot of times, people talk about solutions that work in Europe, or solutions that may work in the United States. We have to understand that the GDP per capita in each of the Asian countries is quite different.”
He pointed out that the gross domestic product (GDP) per capita in every country and the average household size and income indicate which type of vehicle is preferred.
How the Asian markets will take to NEVs may all come down to economics. In this regard, Ganesh points out four elements that would influence the market preferences in each Asian nation:
“The first element is the customer. What can he or she afford? So, we have to understand that this mix of vehicles will evolve in terms of affordability. (The second element) is the government, which has to step in and give subsidies. How much can the government subsidize? What is the tipping point to make that work? The third element is the industry. How can the industry sustain, not just for the automotive original equipment manufacturers (OEMs), but also the whole supply chain? How do we transition the entire supply chain? The final element is customer acceptance.”
Whatever new-energy paths Toyota as a global business entity will embark on for its local markets, it better do so really soon. While we talk of diversity of markets, pricing, and inclusive mobility, climate change-inducing greenhouse gases (GHGs) are still rising, and the global transport sectors are contributing a significant chunk of these GHGs. The world’s most prolific maker and seller of vehicles can also potentially make the most impact in the efforts to mitigate the effects of climate change.
