Toyota is about to do two things that should give it a huge boost over the next few years. The company announced in its first quarter financial reports that it was going to sell more hybrid vehicles this year than it ever has before. And that’s just the start of a new Toyota hybrid offensive that will no doubt have the likes of Hyundai, Kia, and Honda sweating bullets.
The crux of that offensive includes new batteries that will help Toyota sell more hybrids than ever – even more than the five million the company expects to sell this year.
Toyota Will Launch New Hybrid Batteries Soon
Toyota Lithium-ion (Li-ion) & Nickel-metal Hydride (NiMH) Hybrid BatteryToyota
Toyota was the first to put a modern hybrid on sale, though it took a few more years to get to the US, and it has run away with the hybrid vehicle market ever since. The automaker expects to hit five million hybrids this calendar year for the first time, marking nearly 45% of the company’s sales worldwide.
During this fiscal year, which started in May, Toyota expects to sell nearly 6 million electrified models. That will make up 56% of Toyota and Lexus vehicle sales worldwide, a huge figure for the automaker.
On the financial call, the company said that it plans to start building next-generation hybrid batteries by 2027. It will convert enough production capacity in Japan to supply 600,000 vehicles with the new battery cells, and said that the new batteries would offer “enhanced performance and cost competitiveness.”
Later, in the Q&A section, Toyota accounting group boss Takanori Azuma said that Toyota would be expanding total battery production capacity in 2027 and 2028. He said that Toyota’s inventory in the US remains low, but that it is working to “continue our efforts to fully capture customer demand.”
Will Toyota Finally Have Enough Hybrids?
2026 Toyota Corolla Cross HybridToyota
The charts in Toyota’s presentation didn’t spell out how many more hybrids Toyota wants to sell, but the line was a steep one. It expects hybrid sales in the US to grow from around 47% now to more than half by the end of 2027, with growth in China expected to move from just under half to around 55%. Toyota said it expects growth in the rest of Asia, but it will just barely crest 25%. Meanwhile, in Europe, it projects hybrid share to stay steady at around 70% and for hybrid share to fall slightly in Japan, though it will remain well above half.
It’s not clear how quickly Toyota will transition completely to the next-generation hybrid battery. That 600,000-unit figure is also specific to battery production in Japan, and was used as “just one example.” So there could be even more capacity change and growth in other markets, including the US.
This would be Toyota’s fifth-generation lithium-ion hybrid battery technology. The current generation launched in 2023. In 2024, Toyota took full control of its battery operation, then named Primearth EV Energy, and renamed it Toyota Battery Co.
CarBuzz Insight – Why This Matters:
2000 Toyota Prius Silver Side DrivingToyota
It’s not really a surprise that Toyota is going harder on hybrids, but it’s good to see. It’s what Toyota does best, and in the US especially, not being able to get hybrids has driven up prices through dealer markups. More hybrid and PHEV availability likely means better prices for buyers. At least better transaction prices, even if MSRPs stay the same.
