Subaru and Toyota are strengthening their partnership by collaborating on the development of three new electric crossovers. The corporation noted that partnering with Toyota would help alleviate the significant challenge of developing electric vehicles independently.
At a convention on Monday, Subaru CEO Atsushi Osaki expressed concerns about the potential risks of going solo in the field of this discipline, stating that there is a significant threat if they do so.
After achieving a 75% increase in earnings this fiscal year, Osaki noted: “Meanwhile, it’s fairly troublesome to predict how things will unfold from here with EVs.” Subaru sold just 14,000 units of its only all-electric vehicle, the Solterra, last year, including 8,872 in the US.
Among the 852,000 vehicles delivered worldwide in 2023, a mere 1.6 percent were fully electric models.
As Subaru’s electric vehicle (EV) gross sales struggled to gain traction in the crucial US market, the automaker unveiled a bold strategy to turn things around.
By inheriting the leadership from Osaki in April, Subaru is targeting a significant milestone of attaining a 50% electric vehicle (EV) market share, equivalent to around 600,000 units, by 2030. Despite a downward trend, this represents a significant increase over the previous 40% target for hybrid and electric vehicle sales under the old strategy.
By the end of 2026, Toyota intends to have a lineup of four fully electric SUVs, in addition to the Solterra. By 2028, Subaru plans to introduce four additional electric vehicles (EVs), bringing its total lineup to eight.
Subaru aims to increase electric vehicle sales within the US by a staggering 4,400%, targeting 400,000 units by 2028 – a significant jump from the 8,872 Solterra models sold in the previous year?
Subaru and Toyota Join Forces on Three New Electric Vehicles
Subaru’s Solterra, currently under production at Toyota’s Japanese facility, has sparked speculation that the automaker may collaborate with Toyota on the development and construction of its upcoming electric vehicle trio.
Despite owning a 20% stake in Subaru, Toyota’s partnership with the smaller Japanese automaker is poised to alleviate some of Subaru’s concerns as it embarks on an electric transformation. Following discussions with Toyota, we have reached an understanding that it is more effective to mitigate risks through collaborative development.
Subaru’s CEO was also lukewarm about developing electric vehicles in-house for the US market. “Osaki clarified that the company hasn’t considered establishing a battery-electric vehicle production facility at its US-based site.”
As the market evolves rapidly, we’ll move forward while carefully studying the situation. If Toyota begins building its electric vehicles domestically, Subaru could gain access to the federal EV tax credit, potentially boosting demand.
Subaru has announced its intention to expand its hybrid offerings. “While we’ve been driving towards electric vehicles, we recognize the need to continue supporting internal combustion engine products as well.”
Subaru plans to manufacture one of three upcoming electric vehicles (EVs) at its Yajima facility in Japan, supplying them to various manufacturers. Toyota plans to produce one model in the United States, with additional capacity allocated specifically for its own brand.
Toyota is reportedly set to build Subaru’s inaugural three-row electric SUV in Kentucky by 2025, following the launch of its own larger SUV model.
Subaru intends to commence in-house electric vehicle (EV) production in Japan by 2025, boasting an initial annual capacity of approximately 200,000 units. The company plans to establish dedicated electric vehicle (EV) manufacturing lines in 2027, a move that will enable the production of an additional 200,000 units.
Electrek’s Take
Following a market shift towards electric vehicles, several Japanese automotive manufacturers have formed alliances to stay competitive. Nissan and Honda formalized their partnership in March, aimed at accelerating the development of electric vehicle (EV) technology and improving software capabilities.
As Japanese automakers seek to stay in step with electric vehicle (EV) leaders like BYD and Tesla, a flurry of joint ventures is unfolding. By partnering with Toyota, Subaru can leverage their vast network and expertise, thereby preparing itself for the next generation of electric vehicles.
As businesses continue to evolve, they’re getting ready for the next big move. Despite accounting for less than 2% of the market with their single-digit EV sales share, Subaru and Toyota have already fallen behind in the electric vehicle landscape.
By this point, numerous automotive manufacturers have achieved significant milestones, with a growing number of brands boasting double-digit and even triple-digit electric vehicle (EV) market share gains. As Subaru targets a modest 50% electric vehicle (EV) gross sales share by 2030, the company appears to be lagging behind its peers in the industry’s electrification push.
