Toyota Is Reevaluating Its Plans For A Japanese Battery Plant

Toyota’s plans to build its own battery plant in Japan have been delayed as the company rethinks its electric strategy going forward. Global EV adoption isn’t growing as fast as the automaker expected – BZ4x sales totaled just 18,000 units in 2024 — so construction on the plant won’t begin as early as initially planned. The delay won’t have much, if any, effect on the operation of Toyota Battery Manufacturing North Carolina, the company’s $14 billion facility that’s supposed to start shipping hybrid batteries and electrical components this year.

Toyota Still Wants To Build In Japan

Despite the delay, which pertains to the groundbreaking on the battery plant, Toyota is committed to its electric plans. According to Nikkei Asia, the automaking giant planned to finalize a location for the facility in the Japanese prefecture of Fukuoka next month, but it remains to be seen if that will happen. The delay also may prove troublesome if Toyota remains committed to its plans to have the Japanese facility up and running by 2028, which so far it does.

The facility in Fukuoka is going to be the manufacturing site for not only battery arrays but also for Toyota’s next-generation electric vehicles – expected to have up to 600 miles of range. However, Toyota has significantly walked back its timeline for an EV-intensive lineup. In 2023, the automaker said it would build 1.5 million electric cars annually by 2026, and last year, it nearly halved that number to 800,000.

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The Threat Of Tariffs Could Change Toyota’s Plans

Adding another variable to Toyota’s calculus, earlier this week, the Trump administration announced a seismic 20-percent tariff on both automotive components and completed vehicles imported to the US from anywhere in the world, slated to take effect April 2. Toyota may use those tariffs as reason to shift its production split like its rival Honda emphasizing its American facilities for US-market cars and shifting away from Japanese factories. That said, before the tariffs were even a talking point, the automaker had already announced plans to build two different three-row EVs at its factories in Indiana and Kentucky.

The latter will be the first plant in the US to build a Toyota EV, slated to arrive sometime next year. Toyota Motor Manufacturing Kentucky got a $1.3 billion infusion to get ready for its three-row EV, while Indiana saw $1.4 billion. Both products have always been planned to precede Toyota’s Fukuoka battery factory, so they are unlikely to fall under the company’s next generation of EVs and might make use of an enlarged version of the BZ4X’s e-TNGA platform. Hopefully, the larger products will benefit from more advanced battery chemistry and improved electrical architectures so they can run longer than the 4X’s 252 miles of maximum range and charge at a faster rate than 150 kilowatts.

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That aforementioned $14 billion hybrid battery plant in North Carolina is expected to come online imminently, and one of its customers may be a surprising one: Honda. In an effort to circumvent those costly tariffs, both Japanese automakers might use Toyota-built batteries in their gas-electric vehicles.

Source: Nikkei Asia via Carscoops