Toyota, BYD Team Up To Develop Battery EVs

1 min readUpdated Jul 23, 2019Aug 5, 201911:23 PM

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Toyota Motor said it would develop battery electric vehicles (EVs) and batteries with BYD Co Ltd, in a sign it was ramping up partnerships with Chinese players as planned to build affordable EVs for the world’s top auto market. In a joint statement, Toyota and the Chinese electric automaker said on Friday that they would develop sedans and sport utility vehicles, which would then be sold under the Toyota brand in China before 2025.

Earlier this week, Toyota announced it was teaming up with China’s Contemporary Amerex Technology Co Ltd (CATL) to supply and develop batteries for lower-emission vehicles.

Widely considered a late comer in embracing battery EVs versus rivals including Nissan, Toyota had flagged in June that it aimed to get half of its global sales from EVs, including gasoline hybrids, by 2025, five years ahead of schedule.But to meet this accelerated timeline, Toyota, Japan’s top automaker, would need more-than-expected batteries, prompting it to look beyond Panasonic Corp, its long-time partner in battery development, to secure supply.

These measures come amid a breakneck growth in the zero-emission vehicle market, with tighter global emissions regulations expected to shift even more drivers away from gasoline engine vehicles in the coming decades. In China, Toyota is planning to launch its first battery EV, a version of its C-HR/IZOA compact crossover, next year.

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What this means

Toyota's strategic tie-up with BYD for affordable EVs, following its recent partnership with CATL for battery supply, clearly indicates an aggressive pivot to catch up in the battery EV market. This approach, focusing on market-specific partnerships, is a sensible move to meet its ambitious 2025 global sales target for EVs, five years ahead of schedule. While Nissan is considered a rival in this space, Toyota's focus on affordability and local collaboration directly pressures competitors to review their own China strategies and cost structures. The risk lies in integration complexities with new partners and maintaining brand perception as it rolls out locally developed models. We should watch for the launch of its first battery EV, the C-HR/IZOA compact crossover, next year.

Rajiv Menon

Questions & Answers

Which types of vehicles will Toyota and BYD develop together?

Toyota and BYD will develop sedans and sport utility vehicles. These will then be sold under the Toyota brand in China before 2025.

Why is Toyota expanding its battery partnerships beyond Panasonic?

To meet its accelerated timeline for EV sales, Toyota needs more-than-expected batteries. This prompts them to look beyond their long-time partner, Panasonic Corp, to secure sufficient supply.

What is Toyota's target for EV sales globally?

Toyota aims to get half of its global sales from electric vehicles, including gasoline hybrids, by 2025. This goal was flagged in June, accelerating their original timeline by five years.

When will Toyota launch its first battery EV in China?

Toyota plans to launch its first battery EV in China next year. This will be a version of its C-HR/IZOA compact crossover model.

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