The EV transition likely to take longer than the Biden administration would like: Toyota exec

Given the state of the electric vehicle transition in the US, EV skeptic Toyota may be having the last laugh.

In 2021 and 2022, most large automakers were trying to transition as fast as they could to an electric vehicle future. Toyota (TM), one of the behemoths of the industry, dragged its feet with its transition and was roundly criticized.

Though EV sales are rising, sales growth has stalled due to concerns ranging from price to lack of charging infrastructure and range anxiety.

Jack Hollis, Toyota executive vice president and head of Toyota Motor Sales US, thinks the US will eventually make the EV switch, but that it will take longer than expected and require different technologies to get there. Hollis joined Yahoo Finance from the floor of the New York International Auto Show to give us his take.

"I think it's important to understand we need everybody to participate if we're going to really make a difference. If it's just EVs, if you look at it, it's only 8% [of the total US market]. How much is that reducing when a majority of the people buying the EVs right now are buying it as an extra vehicle in their [personal] fleet?” Hollis said. “There are a lot of pieces to this — that's why we think taking a little longer time to get to that goal will allow all of us to participate."

Hollis added that it took 10 years to go from virtually zero to 8% EV market share in the US and that to meet the original White House goal of 67% EV penetration by 2032 just isn't feasible. "We just think 2032 is a little too short term, and we have to go a little bit longer so that the customer can come with us on that journey," Hollis added.

Toyota believes hybrids will help bridge the gap to full electrification in both the US and abroad, in part because the vehicles use fewer expensive materials and require smaller battery backs, Hollis said.

Toyota’s all-new 2025 Camry, which is on display at the New York Auto Show, will be exclusively hybrid, using both plug-in hybrid and mild-hybrid powertrains. The Japanese automaker, which pioneered hybrids with its Prius back in 2000, will offer hybrid tech with its upcoming Tacoma mid-size pickups too.

“Absolutely,” Hollis affirmed when asked whether hybrid tech could get the United States to meet the federal government's lowered emissions goals targeted for 2032. “[What] we have to think about is our precious metals or limited resources ... if you use the same amount of resources [needed for one battery electric vehicle], I can build you six plug-in hybrids — reducing significant amounts of CO₂ and costing about $6,000 to $8,000 less per vehicle,” he said.

With only one BEV on the market (the bZ4X) and one hydrogen fuel cell vehicle (the Mirai sedan) at the moment, Toyota has a long way to go for a fully electric product portfolio. Toyota had planned to introduce 30 new BEVs globally by 2030; Toyota's new goal is to have 70% of sales by 2030 be “electrified” vehicles.

Pivoting to the broader auto market, Hollis sees continued momentum for Toyota in the US after a strong start to the year. Toyota reported February sales of 165,900 units (up 16%), with sales hitting 184,450, including its Lexus division (up 17%). Toyota said electrified vehicle (hybrid and EV combined) deliveries jumped 84% to 68,445.

“We still have demand greater than supply,” Hollis said when asked about customer sentiment at the dealer level. “We're still seeing a significant demand for our vehicles and like we just talked about earlier, we have a lot of new products. So there's a lot of pent-up demand still.”

Toyota and Hollis see the overall industry growing “a little bit” this year to around 16 million units sold in the US, with Hollis thinking overall US sales might go even higher than that. Part of that is likely due to the high amount of older cars on US roads, with the average vehicle hovering around 12.5 years and likely needing replacement.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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