Dive Brief:
- Later this month, Toyota Motor Corp. will acquire Primearth EV Energy Co., a battery joint venture between the automaker and Panasonic founded in 1996, the automaker announced Tuesday. Terms of the deal were not disclosed.
- Primearth EV Energy Co. currently produces batteries for conventional hybrid-electric vehicles and plans to make batteries for plug-in hybrids and battery-electric vehicles.
- Toyota said the acquisition, which would make the battery company a wholly-owned subsidiary, would help it respond to changes in demand for electrified vehicles.
Dive Insight:
Like other legacy automakers, Toyota has reined in its short-term EV plans and turned to hybrids to meet stricter emission standards and consumer demand. Its plan appears to be paying off, as strong hybrid sales helped boost the company’s earnings last quarter.
However, the automaker says it's still committed to EVs in the long term and plans to triple EV production to 600,000 vehicles in 2025. Toyota plans to invest more than $70 billion in electrification by 2030, with hybrid and fully electric models accounting for up to 70% of the company’s U.S. sales by 2030.
In a press release, Toyota said Primearth EV Energy Co.’s batteries would make its mass-market EVs more competitive. The supplier currently offers battery modules, electronic control units and lithium-ion battery packs. It has supplied batteries for the Toyota Prius and other hybrids.
Primearth EV Energy Co. has about 4,700 employees and operates three plants in Japan. Toyota currently owns 80.5% of the company, while Panasonic owns a 19.5% stake. In the release, Toyota said Primearth EV Energy Co. may change its name.
In March 2023, Toyota shifted more than half of its R&D staff and budgets to accelerate its work on electrification, advanced battery technologies and software-defined vehicles. In June, the automaker announced plans to streamline its EV manufacturing processes with new modular designs, giga-casting, and self-propelling production technology to lower the costs of EV production and make its factories more efficient.
Since then, Toyota has announced several new investments and partnerships to boost EV production, including an $8 billion EV battery plant expansion in North Carolina and a $1.3 billion investment to increase EV production at its assembly plant in Kentucky.
