Toyota to outshine rivals as more consumers opt for hybrids amid EV slowdown

Toyota's reliance on hybrid vehicles puts them in a strong position despite weakening EV demand and production cuts.

When Tony Le set out with his wife to buy a new car last year, he looked at Tesla and other all-electric models.

In the end, the 37-year-old Modesto, California, tech worker opted for a Toyota RAV4 Hybrid due to worries over getting stranded with a purely electric vehicle, a dead battery and no charging station in sight.

“Sometimes I want to play with the electric vehicles just based on the speed and torque. But for practical use ... it just didn’t make sense,” said Mr. Le, who often drives to Washington state from California for work.

Mr. Le is among the growing number of consumers accelerating hybrid vehicle sales, leaving long-time hybrid maker Toyota Motor in pole position to lap rivals who have been making a rapid transition towards full electrification and now grapple with weakening EV demand.

High interest rates and an uncertain economic outlook have also prompted many EV makers to cut their production targets and warn of slowing sales growth in recent weeks.

Toyota, however, is expected to offer a more upbeat outlook when it reports its earnings on Tuesday, helped by its heavy reliance on hybrids, which accounted for around one third of its total sales of more than 10 million vehicles last year.

“Pretty much every model we sell now is either exclusively hybrid or has a hybrid variant,” Greg Davis, general manager of Walser Toyota, a dealership in Minnesota, said.