Toyota Advances Next-Generation Internal Combustion Engine Development, Plans to Sell Powertrains Externally

Toyota is advancing the development of next-generation internal combustion engines and plans to sell powertrains to other automakers. Toyota aims to achieve annual external powertrain sales revenue of approximately 1.5 billion euros (about 11.166 billion yuan) by 2032, with an order target of 500 million euros (about 3.722 billion yuan) for 2026. The new-generation engines and hybrid systems are planned for delivery as early as 2027. Toyota first unveiled its new-generation engines in 2024. The new series comes in three specifications: a 1.5L naturally aspirated four-cylinder, a 1.5L turbocharged four-cylinder, and a 2.0L turbocharged four-cylinder engine. Among them, the 1.5L turbocharged engine targets power output comparable to conventional 2.5L naturally aspirated engines, while the 2.0L turbocharged engine targets power exceeding that of the existing 2.4L turbocharged engine. Both 1.5L engines can be paired with hybrid systems, and the 2.0L turbocharged engine can be used either standalone or in combination with electric drive systems. Daihatsu is a wholly-owned subsidiary of Toyota. Toyota holds 21.5% of voting rights in Subaru and a 5.1% stake in Mazda. Including these partners, Toyota can access an automotive production system with a combined annual output of approximately 16 million vehicles, more than half of which come from Toyota, Lexus, and Daihatsu.