Toyota to Start Mass-Producing Electric Vehicles By 2025 (TSLA, TM) – Investopedia
The list of competitors for Tesla Motors Corp.’s (TSLA) Model 3, its first mass-market electric vehicle, is getting longer.
According to a news report in the Nikkei newspaper, Toyota Motor Corp. (TM) will start mass-producing electric vehicles by the 2020 Tokyo Olympics. The car is expected to have a range of 186 miles on a single charge. In its bid to enter the mass-market electric vehicle space, Toyota joins General Motors Company (GM), which unveiled the Chevy Bolt recently, and Volkswagen, which intends to increase the contribution of electric vehicles to its top line from 1% to 25% by 2025. (See also: GM Reveals Price Of Chevy Bolt).
Toyota had earlier partnered with Tesla to sell electric cars between 2012 and 2014. The Japanese company plans to put a team in place for development of its version of the vehicle “as early as next year.” It established a battery research division in January this year and may also partner with other battery suppliers to speed up development and procurement of affordable electric batteries for its car. (See also: Volkswagen To Launch Electric Car Strategy)
Tesla plans to start production on the Model 3 early next year and deliver its mass-market EV during the latter half of 2017. The company, which is already facing tough questions from analysts and investors over how it proposes to ramp up production amid a controversial merger with SolarCity Corp. (SCTY), is building a Nevada Gigafactory in partnership with Panasonic to develop batteries and bring down costs for its car.
Tesla is facing off against a formidable set of competitors with deep pockets and research expertise. For example, General Motors is already on track to launch the first mass-market electric vehicle by the end of this year. The Detroit-based car company showed off the Chevy Bolt, which is expected to cost $37,495 and offer a 238-mile range, to critical acclaim earlier this year. It confirmed yesterday that production was on track and that it would deliver the first set of Bolts before the end of this year.
The entry of major players into the electric vehicle industry is the result of a combination of increasingly favorable regulation and affordable technology. Per some estimates, global car sales are expected to account for 35% of new car sales by 2040.