Toyota doubles down on EV investment at North Carolina plant as rivals pull back

Toyota doubles down on EV investment at North Carolina plant as rivals pull back

Toyota (TM) is now doubling down on building out its battery capacity in the US. On Tuesday, the automaker announced it will be expanding its investment at its North Carolina battery manufacturing plant (TBMNC) by nearly $8 billion, an investment that will also add approximately 3,000 new jobs. Toyota says this new investment brings its total outlay to the upcoming facility to $13.9 billion, with 5,000 jobs created in total.

The Liberty-based plant will make batteries for Toyota’s EVs and PHEVs (plug-in hybrid electric vehicles). Toyota says eight additional production lines will now be added to the two previously announced lines, with the ability to create 30 GWh annually by 2030. Assuming a 50kWh battery size, that would mean an annual capacity of 600,000 EV battery packs a year.

Toyota says the plant will begin manufacturing batteries by 2025, and by that time it expects to have an “electrified” option for every Toyota and Lexus vehicle globally. The Japanese automaker said it currently offers 26 “electrified” options, more than any other automaker. Toyota gets to this number by counting all the numerous hybrid options it offers across products like the Prius, RAV4 Hybrid, and Hylander Hybrid, for example. Toyota only offers two pure EVs at the moment — the bZ4X SUV and its twin, the Lexus RZ.

Toyota’s about-face comes after a change in leadership late last year. Akio Toyoda stepped down as president in April 2023, handing over the reins to Koji Sato, who became the new CEO.

While Toyoda became chairman of the board, the change in managerial leadership was made to boost Toyota’s efforts in EVs. Toyoda was considered an EV skeptic, or at least someone who thought the EV transformation would take some time.

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“Just like the fully autonomous cars that we are all supposed to be driving by now, EVs are just going to take longer to become mainstream than [the] media would like us to believe,” Toyoda said at the automaker’s annual sales meeting in Las Vegas last year.

That being said, Toyota’s new CEO believes EVs are still vitally important for the Japanese automaker as it builds out its game plan for the future, though he is cautiously optimistic.

“Battery EVs are the missing piece,” Sato said to Automotive News last week at the Tokyo auto show. “But we are not going to launch something imperfect just because there’s a deadline. We will ensure they are developed to perfection.”

With rivals like Ford and GM pulling back on EV and battery expansion plans in the US, Toyota’s latest move could be considered a head-scratcher, though it could be said Toyota had been falling behind in EV investments and needed to catch up to its competitors. Perhaps a slight slowing in EV demand here in the US will give the Japanese automaker the time it needs.

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

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