Toyota bets big on hybrid-only models as EV demand slows

AUSTIN, Texas (Reuters): Toyota may be one of the slowest legacy automakers to develop electric vehicles but it could be the first to jettison cars powered only by gasoline.

Almost three decades after launching the Prius, its pioneering gasoline-electric hybrid, Toyota is moving to convert most, and eventually maybe all, of its Toyota and Lexus line-up to hybrid-only models, two Toyota executives told Reuters.

Toyota’s stubborn focus on hybrids over EVs is part of a broader challenge by the world’s biggest automaker to the prevailing industry and regulatory orthodoxy that all cars will be electric in the near future.

Toyota Chairman Akio Toyoda said in January that he believed the global share of EVs would top out at just 30%. The Japanese automaker instead touts a “multi-pathway” strategy that includes EVs along with hybrids, hydrogen fuel-cell vehicles, green fuels and, potentially, other technologies yet to emerge.

“Going forward, we plan to evaluate, carline by carline, whether going all-hybrid makes sense,” David Christ, head of sales and marketing for Toyota in North America, told Reuters.

Those evaluations will come with every model redesign, if not sooner.

That includes the pending overhaul of the RAV4 for the 2026 model year. The RAV4, America’s best-selling SUV, already has hybrid variants that account for about half of sales.

Two people familiar with Toyota’s product planning discussions said the automaker is highly likely to ditch the gasoline-only version for the North American market, but hasn’t made a final call.

The automaker has already stopped offering a gasoline-only version of its Camry, America’s best-selling sedan, for the 2025 model year while its rugged Land Cruiser and Sienna minivan, for example, also now come only as hybrids.

Many of the hybrid-only models will also likely come as a plug-in hybrid with a bigger battery, according to the two people, who declined to be named.

Toyota’s effort to convert all or almost all of its North American line-up to hybrid-only vehicles has not previously been reported.