Toyota (7203.T) stated on Tuesday that it will deploy high-performance, solid-state batteries and other technologies to extend the driving range and lower costs of future electric vehicles (EVs), a strategic turn that drove its shares higher.

The Japanese conglomerate’s technical roadmap, which covered topics as diverse as next-generation battery development and a dramatic factory restructuring, amounted to the automaker’s most comprehensive exposure of its strategy for competing in the fast-growing EV industry, where it has lagged rivals led by Tesla (TSLA.O).

The announcement comes just a day before the company’s annual shareholders meeting, when governance and strategy will be scrutinized, including a gradual shift to battery EVs under former CEO Akio Toyoda.

The world’s best-selling automaker’s stock rose 5% on the day to 2,173 yen, the highest since August.

Toyota stated that it plans to release next-generation lithium-ion batteries with longer ranges and faster charging starting in 2026.

Related: Robots From Toyota Research Institute Depart

It also announced a “technological breakthrough” that tackles durability issues in solid-state batteries and stated that it is working on methods to mass produce those batteries, with a commercialization date of 2027-2028.

Solid-state batteries can store more energy than liquid electrolyte batteries currently in use. Automakers and analysts anticipate that they will accelerate the shift to EVs by solving a fundamental consumer concern: range.

Nonetheless, such batteries are expensive and will most certainly remain so for many years. Toyota will protect itself with higher-performing lithium iron phosphate batteries, a less expensive alternative to the lithium-ion batteries that have fueled EV growth in China, the world’s largest vehicle market.

Toyota announced it would build an EV with a more efficient lithium-ion battery with a range of 1,000 km (621 miles) at the high end of the market. In comparison, the long-range version of the world’s best-selling EV, the lithium-ion-powered Tesla Model Y, can go for roughly 530 kilometers according to US norms.

According to Toyota, an EV powered by a solid-state battery would have a range of 1,200 km and a charge time of only 10 minutes. In comparison, the Tesla Supercharger network, the greatest of its kind, provides 321 kilometers of charge in 15 minutes.

Toyota did not provide any information about the initiatives’ projected expenses or required investment.

To compete, engineers at the automaker have been mulling a rethink of its EV strategy since last year.

Toyota has adopted much of the redesign that engineers and planners have been creating as options for months, according to the roadmap released on Tuesday.

This includes the usage of electric-axle and other technology from Aisin (7259.T) and Denso (6902.T).

“What we want to achieve is to change the future with BEVs,” Takero Kato, head of Toyota’s new EV business BEV Factory, said in a video posted to the automaker’s YouTube page on Tuesday.

Toyota announced the development of a specialized EV platform to cut the cost of new models, as well as a heavily automated assembly line that would replace the conveyor belt technology that has defined vehicle manufacture since Henry Ford over 100 years ago.

Cars in production would drive themselves through Toyota’s “self-propelling” assembly line.

It also stated that it would use Giga casting to minimize production costs, following Tesla’s lead in using enormous, aluminum casting machines to reduce vehicle complexity.

Toyota’s move to match Tesla’s edge in production efficiency startled Koji Endo, senior analyst at SBI Securities. “I’m not sure Toyota can yet push back in a counter-offensive, but it’s getting ready to try,” he said.

Toyota’s BEV Factory, which opened in May, plans to produce approximately 1.7 million vehicles by 2030, or over half of the 3.5 million EVs Toyota hopes to sell yearly by that year.

For the first time, the carmaker sold 8,584 EVs worldwide in April, including under its Lexus brand, accounting for more than 1% of total global sales in a single month.

FILE – In this Sunday, March 21, 2021 file photo, the company logo adorns a sign outside a Toyota dealership in Lakewood, Colo. Nippon Steel Corp. is suing Toyota Motor Corp. over a patent for technology key for electric motors in a rare case of legal wrangling between Japan’s top steelmaker and automaker over intellectual property. Tokyo-based Nippon Steel filed the lawsuit Thursday, Oct. 14, in Tokyo District Court, demanding compensation for damages totaling 20 billion yen ($177 million). Also named in the lawsuit is Baoshan Iron & Steel Co., or Baosteel, a Chinese steelmaker that produces and supplies the steel that allegedly violates the patent. (AP Photo/David Zalubowski, File)

Toyota sold almost 10.5 million vehicles in 2022 and has a market capitalization of approximately $254 billion. Tesla, on the other hand, sold one-eighth as many automobiles while being valued at about $791 billion, a premium reflecting investor confidence in Tesla’s growth potential.

Toyota has long stated that it aims to provide consumers with a variety of new-energy vehicles, including petrol-electric hybrids, hydrogen fuel cells, and battery EVs, as part of the industry’s move away from gasoline-powered vehicles.


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