Toyota plans to introduce next-generation hybrid batteries in 2027 as it aims to achieve 5 million hybrid sales.

      TL;DR: Toyota will commence the production of next-generation hybrid batteries in 2027, anticipating over 5 million hybrid sales globally this year.

      During its quarterly earnings call on Tuesday, Toyota announced the launch of a new generation of hybrid batteries starting next year. The automaker plans to modify existing battery production lines in Japan, which will have the capacity to produce enough new battery packs for around 600,000 vehicles, claiming these will provide enhanced performance at a reduced cost.

      “Our battery production capacity will expand in 2027 and 2028, and we will continue our initiatives to meet customer demand,” said Takanori Azuma, Toyota's chief accounting officer, to investors. The specific chemistry of the new batteries was not disclosed, nor was it stated whether they will improve upon current lithium-ion cells or involve a different technology.

      This investment aligns with Toyota’s sales achievements. The company sold approximately 2.3 million hybrid vehicles globally in the first half of 2026, making up about 86 percent of its total electrified vehicle sales. Overall electrified vehicle sales, which include hybrids, plug-in hybrids, battery-electric vehicles, and fuel-cell vehicles, rose over nine percent year on year to 2.7 million units.

      Toyota anticipates global hybrid sales will surpass five million units for the first time by year-end. This increase occurs even as the total global sales for Toyota and Lexus models dropped around three percent to roughly five million vehicles in the January-to-June period, marking the first decline in two years.

      Several factors are contributing to the hybrid sales boom, particularly high fuel prices due to the situation in Iran, pushing consumers toward more fuel-efficient options. In the United States, Toyota’s largest market, the reduction of federal EV tax credits and stricter tariff regulations have slowed EV growth while promoting hybrid adoption. Additionally, Toyota has made its popular models, the Camry and RAV4, hybrid-only for the 2026 model year.

      Sales of battery-electric vehicles have also surged, with 193,000 units sold in the first half, reflecting a 135 percent increase year on year. Toyota is advancing next-generation lithium-ion batteries for these EVs, aiming for a range exceeding 1,000 kilometers on the WLTP cycle, which translates to just over 500 miles under the stricter EPA standard, by 2027. Furthermore, the company is developing solid-state batteries that can charge from 10 to 80 percent in under 10 minutes, with production expected between 2027 and 2028.

      During the call, Toyota executives acknowledged that improvements are necessary for their EVs to compete with advanced models from China. “We aim to collaborate closely with our local partners, including through joint development, to enhance our competitive edge,” said Azuma. However, hybrids continue to be the primary growth driver, and the new batteries are intended to maintain that momentum.