The road ahead of Toyota as it begins to seriously compete in the all-electric market just got a whole lot tougher. As the veteran Japanese automaker recently confirmed, it has already passed the 200,000 unit milestone for the US$7,500 tax credit for hybrid and all-electric vehicles.
The milestone was originally reported by Bloomberg, although the publication’s estimates were later corroborated by Toyota. Once this is established, Toyota’s hybrid and all-electric vehicles will no longer be eligible for the full US$7,500 incentive.
Considering the Japanese automaker has only just begun pushing its all-electric crossover, the bZ4X, it seems safe to assume that most of Toyota’s 200,000-unit tax credits have been consumed by the company’s hybrid vehicles. like the Prius.
This could bring additional challenges for Toyota, as it would mean the company would have to compete with EV veterans like Tesla and legacy rivals that still have access to U.S. full electric vehicle tax credits like Hyundai and Kia.
Tesla officially broke its 200,000 tax credit limit as early as 2018, and since then the company and its two mainstream vehicles, the Model 3 sedan and the Model Y crossover, have only grown in popularity. Tesla still leads the EV race by a wide margin, which is particularly impressive since the company’s vehicles are high-priced and no longer eligible for the US$7,500 tax credit.
Hyundai and Kia, on the other hand, are just getting started with their respective modern EV push with excellent EVs like the IONIQ 5 and EV6. Compared to the Toyota bZ4X, which no longer qualifies for the full $7,500 tax credit, the Hyundai IONIQ 5 and Kia EV6 may be more attractive to EV buyers.
And that ignores the fact that the Toyota bZ4X is simply a pretty mid-range electric car with a fairly reasonable starting price but disappointing charging capabilities. In a way, the bZ4X is a vehicle that seems to reflect Toyota’s reservations about all-electric cars as a whole. As a result, it simply pales in comparison to no-compromise electric vehicles like the Model Y or legacy electric cars like the IONIQ 5 which have obviously been designed to be as competitive as possible.
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