Akio Toyoda Admits ICE Era Is Waning as Chinese EVs Accelerate Global Expansion

Toyota Motor Corporation President Akio Toyoda recently expressed concern in media interviews about the gradual decline of internal combustion engine (ICE) culture, noting that numerous engine-related jobs across Japan’s automotive industry could be significantly impacted. While he had long been cautious about electric vehicles (EVs), he now appears to be acknowledging the reality of the industry’s ongoing electrification shift. In China, the penetration rate of new energy vehicles (NEVs) has surpassed 60%, while the market share of fuel-powered vehicles has dropped to 37.1%. According to the latest data, all top ten best-selling passenger car models last month were NEVs—marking the first time that ICE vehicles have been entirely absent from the monthly sales rankings. Overseas, Chinese EVs are experiencing rapid sales growth in markets such as South Korea, Australia, Southeast Asia, and Europe, exerting clear competitive pressure on Japanese brands. Meanwhile, on June 4, Toyota unveiled a new-generation engine platform and its sixth-generation Toyota Hybrid System (THS). The dedicated 2.5L hybrid engine achieves a mass-production thermal efficiency of 44.5%, delivering a combined fuel consumption of under 4 liters per 100 kilometers and a driving range of up to 1,200 kilometers. However, in today’s competitive landscape, the core battleground for EVs has shifted toward battery technology, chip computing power, software algorithms, intelligent cockpits, supply chain integration, and economies of scale in cost control. Japanese automakers’ decades-long focus on internal combustion engines has deeply entrenched their R&D resources, talent structure, supply chains, and production systems around conventional powertrains, making their transition to electrification particularly challenging.