Automakers Lower 2030 EV Targets Amid Market Challenges

As 2030 approaches, the automotive industry's goal of electrification is proving more complex than anticipated. Major brands such as Toyota, Volvo, Volkswagen, and Ford have announced significant adjustments to their targets, either delaying or reducing their EV sales projections.

A recent study by Ernst and Young reveals that consumer interest in purchasing electric vehicles in the United States has dropped by 14% compared to the previous year. This decline is partly due to concerns about the high cost of replacing EV batteries, which can range from US$6,500 and US$20,000, as well as anxiety over vehicle range and the lack of charging infrastructure.

In response to these challenges, brands like Toyota have strategically shifted their focus toward hybrid vehicles rather than fully electric ones. Toyota, a leader in the hybrid market with models such as the Prius, has reduced its global EV production targets by one-third, now aiming to produce 1 million vehicles by 2026 instead of the previously projected 1.5 million.

Francisco Cabeza, President, Mexican Association for the Promotion of Electric Vehicles (AMIVE), views this restructuring  as a positive development. “What is being reported as a setback, I see as something positive because it means that the necessary tools are being developed for large-scale implementations, not only as pilot projects,” he stated.

Toyota is not the only automaker revising its targets. Volvo, which had previously set a goal of selling only electric vehicles by 2030, has now softened its strategy. The company now aims for 90% to 100% of its sales to be fully electric or plug-in hybrids by that date, allowing room for conventional hybrids.

Ford has also adjusted its plans, announcing the addition of more hybrid vehicles to its lineup. The company argues that affordability and reliability remain key factors for consumers. This shift is particularly notable in the U.S. market, where buyers have shown a growing preference for hybrids, according to the Ernst & Young study.

“Governments and brands are rethinking electrification goals because they are now taking it seriously,” said Francisco Cabeza. He also noted that expecting the entire vehicle fleet to be electric by 2030 is unrealistic, especially in a country like Mexico, where more than 55 million vehicles are currently on the roads. “Electric vehicles will likely coexist with hybrids, hydrogen, gas vehicles, and more,” he added.

Cabeza also highlighted the importance of the upcoming review of the USMCA in 2026, which could impact the electrification landscape in North America depending on the environmental policies adopted by US and Mexican leaders.

“The review of the USMCA in 2026 will be a major topic. We will need to see who becomes President of the United States, which will generate a very interesting conversation with our President, who is very sensitive to environmental issues. On the other hand, our country and the sovereignty we have allow us to decide which factories we have, and where the brands come from,” he pointed out.