Toyota’s 1:6:90 Rule – The Case for Hybrids

Nothing beats sending someone a private message, only to have them immediately take a screenshot and send it to someone else. 

Corporate leak: Toyota recently issued a summary of its electric vehicle production and sales strategy to its dealerships, providing insight into Toyota’s decision to focus more on hybrids than full EVs. Like any good confidential internal document, it was promptly leaked to the public over Twitter.

Toyota intends to focus on hybrids instead of EVs because of three major barriers to EV adoption

1. Critical mineral supply: According to Benchmark Minerals, over 300 new mines are required to support battery demand by 2035. While U.S. battery manufacturing capacity is taking off, Toyota doesn’t think raw mineral supply will be able to keep up, leading to shortages and higher costs.

• Other automakers are even taking the unprecedented step to partner and invest in the mining sector to secure their own mineral supply.

2. Charging infrastructure: Public chargers have started to gain a reputation for being unreliable. Nothing ruins a family road trip faster than pulling up to a slow or broken EV charger. (No kids, we’re not there yet, and now we’re staying at this truck-stop motel for the night…)

• Infrastructure also lacks standardization which can limit access and reduce charging speeds—just ask anyone driving around their EV with charging adapters like they’re the Key Maker from the Matrix.

3. Affordability. Even without the cost of installing a home charger, electric vehicles have historically been more expensive than their combustion engine counterparts. 

• While this is typically still true, government subsidies and Tesla’s price cuts are actively trying to change this.

Typical battery electric vehicle supply chain lead times
years

Toyota has a goal to “reduce carbon emissions as much as possible, as soon as possible” including a 35 percent reduction in emissions from their vehicles by 2030, and a 90 percent reduction in emissions from their entire fleet by 2050.

Toyota’s solution: the 1:6:90 rule

In the face of critical mineral supply shortages and other challenges, the Japanese automaker believes that hybrids, not electric vehicles, are the answer.

They crunched the numbers like they’re Sheldon Copper and found that using the same amount of critical minerals needed to make a single full-electric vehicle could instead be used to make 6 plug-in hybrids or 90 non-plug-in hybrids.

The punchline: In their view, not only does this help more people drive lower-emission vehicles, Toyota believes that the overall carbon reduction of 90 hybrids over their lifetime is 37 times greater than a single-battery electric vehicle.

As far as Toyota is concerned, having 90 people take a small step into a hybrid seems better than having one person take a giant leap into an EV. The transition then, is not the sum of a few grand acts but the collection of small changes made by everyone.

The big picture: In the case of EVs, infrastructure, affordability, and critical mineral supply chains need to catch up to the ambitions that many governments that are looking to decarbonize the transportation sector, and it might be a long and bumpy road to get there.

Japan historically has lacked natural resoruces and so looks to pragmatic solutions to thrive. They may be a microcosm of the EV build out in the coming decades.

+Additional Reading: Why Toyota Isn’t Rushing to Sell You an Electric Vehicle