Toyota, the world’s
largest producer of gas-electric vehicles, plans to launch U.S. production of
the hybrid version of its Highlander SUV at its Indiana assembly plant by 2020.
It will mark the first
time a Toyota hybrid will be assembled in the U.S., though the Japanese
manufacturer had previously considered building an American version of the
Prius, the world’s most popular gas-electric model.
The announcement comes as
Toyota gets ready to announce a broad electrification strategy that, among
other things, will see it set up a new assembly plant in the U.S. to produce an
all-new battery-electric vehicle. That project is part of a joint venture with
Mazda, the smaller Japanese maker expected to sell its own versions of the new
BEV.
“This investment is part
of our long-term commitment to build more vehicles and components in the
markets in which we sell them,” said Jim Lentz, CEO of Toyota Motor North
America. “This strategy is designed to better serve our customers and dealers,
and positions our manufacturing operations to fulfill their needs well into the
future.”
The latest announcement
covers a series of investments, collectively totaling $373.8 million, at an
array of Toyota’s U.S. manufacturing plants. That includes not only the Indiana
plant assembling the Highlander but facilities in West Virginia, Missouri,
Kentucky and Tennessee that will produce components and assemble the hybrid
2.5-liter powertrain.
The 2017 Toyota
Highlander makes its debut and will also be the automaker's first-ever
U.S.-built hybrid.
A sixth plant, located in
Huntsville, Alabama, will be upgraded to produce engines that can be used on a
variety of different vehicles based off the company’s new Toyota New Generation
Architecture. That platform is used for the latest-generation Prius and will
serve as the underpinning for a wide range of other Toyota models going
forward.
In terms of jobs, the
impact will be modest, Toyota said, creating just 50 new positions at the
Alabama plant. But the investment should “help to ensure the stability” of the
workforce at the other plants, according to a company statement.
Toyota has, until now,
been reluctant to move hybrid production out of Japan. It hasn’t helped that
demand for gas-electric models like the Prius has declined over the last couple
years, driven downward, in part, due to the collapse of global oil prices. But
overall demand for electrified vehicles has been increasing in recent months,
and the numbers are expected to grow more rapidly in the coming years.
A key reason is that
emissions and mileage mandates are becoming more stringent. Even if the Trump
Administration, as it has signaled, rolls back the 54.5 mpg Corporate Average
Fuel Economy standard phasing in between now and 2025, few expect the trend to reverse.
Among other things, a large portion of the U.S. is now covered by the even
stricter Zero-Emissions Vehicle, or ZEV, mandate, enacted by California.
Meanwhile, most key
markets abroad are, if anything, planning even tougher mandates. Several countries
have already announced plans to phase out the internal combustion engine
entirely, while others, including Britain, France, Germany and China, India.,
have signaled their intent to go with similar rules.
Toyota has only just
gotten serious about advanced battery power with the Prius Prime.
That has led a growing
number of manufacturers to announce broad electrification plans. Volvo, for
example, will offer only hybrids, plug-ins and pure BEV models on all new
vehicles launched after 2018. BMW, Volkswagen, Mercedes-Benz and others now
plan to offer some form of electrified drive option for all future models.
Though a pioneer in the
use of battery power, Toyota has been reluctant to go much beyond conventional
hybrids. It has all changed and after a joint venture with Mazda to produce pure electric models in the USA. They have even entered into another Joint Venture with Mazda and Denso to develop EV's , safety features, batteries and more.
Everyone in the industry is moving quickly to develop EV's, batteries, and even battery recharging systems.
Every week we find all manufacturers moving forward with the future of electric vehicles. Fuel cells are still being considered but the infrastructure has been a problem.
BRUCE HUBBARD
BONNIE LYNCH
BRADLEY HUBBARD
AUTO ADVISOR GROUP
EDITED FROM SOURCES AND THEIR PRESS RELEASES
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