EV Sales in Latin America May Only Touch 5% by 2030, Toyota Says
(Bloomberg) -- Toyota Motor Corp. may be splashing out around $35 billion globally on its battery-electric-car push but in Latin America, electric vehicles will only comprise about 5% of the region’s total market by 2030, the Japanese automaker’s president and chief executive officer for Latin America and the Caribbean said.
A lack of government guidelines is part of the reason for the slow EV adoption, Masahiro Inoue said, noting that while he has plans on his desk for 2030, authorities in Brazil, where Toyota sells most of its cars in the region, haven’t outlined a clear transport decarbonization road map.
It’s important Brazil take the lead, considering it’s “one of the rare countries that has a complete automobile industry,” Inoue said in an interview with Bloomberg News. “In the southern hemisphere only Brazil has this situation,” he added. Neighboring nations could follow what Brazil decides, whether that’s embracing a hybrid, flex-hybrid or a purely electric strategy.
Inoue sees around 6 million cars being sold in Latin America and the Caribbean, excluding Mexico, in 2030, with about half of those going to Brazil. While that represents growth of 40% compared to 2021 levels, just 5% of those cars are expected to be EVs. Around 10% may be plug-in hybrids while almost 40% will be so-called flexible-hybrid cars, or ones that have an electric engine combined with a combustion engine that can run with gasoline or ethanol.
The large chunk of flex-hybrids means Toyota should be able to start local production of some relevant parts, Inoue said. Currently Toyota imports the hybrid part of flex-hybrid cars sold in Brazil from Japan due to lack of scale.
Toyota has sold more than 25,000 flex-hybrids in Latin America to date, with the Corolla Cross sports-utility vehicle proving particularly popular since its March debut, he said. Uptake of that model has led Toyota to add a third shift using another 500 staff at its Sorocaba plant in Brazil.
Toyota isn’t the only automaker with an eye on flex-hybrids in Latin America. Volkswagen AG said in September it plans to launch six similar models in Brazil within five years. Nissan Motor Co. is also working on ethanol-fuel-cell cars in the region.
Akio Toyoda, the Japanese automaker’s global president, said earlier this month that EVs can be divided into two categories depending on the energy they use: Carbon-reducing vehicles, which don’t use clean energy but which result in zero CO2 emissions, and carbon-neutral vehicles, which run on clean energy and achieve zero CO2 emissions.
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