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Toyota, all-round ‘halving CO2 emissions’ President Sato’s 35-year target – taking into account environmental regulations in each country Emerging markets, profits from HV sales

Toyota’s ‘all-round strategy’, which includes a wide range of eco-friendly vehicles such as hybrid vehicles (HV) and electric vehicles (EV), is designed to meet the needs of each region. Toyota sells vehicles in various parts of the world, including Japan, the US, Europe and emerging countries, and has to take into account the different energy mix and environmental regulations in each region. Production of EVs in particular is low, and the company is rapidly building a system to increase production.

‘Compared to other automakers, Toyota has a well-balanced portfolio on a global scale.’ President Tsuneji Sato said in a joint interview.

The composition of Toyota’s sales volume by region is 10-20% each in the US, China, Asia, Japan and Europe, with the rest of the world also earning 20%. The situation is different from Volkswagen (VW) of Germany, where Europe and China account for the majority of sales, and General Motors (GM) of the US, which earns mainly from the US and China.

The car market itself is expanding in Asia and other emerging economies, and demand for petrol-powered vehicles is firm. HVs, which are more environmentally friendly than petrol cars, are also expected to expand in the future. If this situation continues, it will be possible to achieve both a certain level of CO2 emissions reduction and secure profits without having to rely on EVs.

In Europe, the US and China, a rapid shift to EVs is underway against the backdrop of strict environmental regulations. VW and GM, whose sales are biased towards these regions, are facing high costs associated with EV investment.

For the time being, Toyota aims to secure earnings from HV sales in emerging markets. In the long term, however, the shift to EVs is likely to spread to emerging countries, and Toyota could lose market share if it continues to delay the launch of EVs. Toyota needs to use HVs to generate resources for EV development, while at the same time preparing to increase EV production.