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For automakers, EV surge is everything everywhere all at once

Reuters (The Jakarta Post)

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Detroit, United States

Sat, January 28, 2023 Published on Jan. 27, 2023 Published on 2023-01-27T20:27:57+07:00

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A new BMW i4 car is presented during an event marking the 100th anniversary of the BMW plant in Munich, southern Germany, on May 20, 2022.

T

he surprise leadership shuffle on Thursday at Toyota, renewed urgency at Renault and Nissan to restructure their alliance and Elon Musk's declaration that Tesla will be the world's number-one automaker by a wide margin have one thing in common: What once defined the global auto industry's center is no longer holding.

The announcement that Akio Toyoda will step down as chief executive of the world's top-selling automaker on April 1 came just hours after Musk used a quarterly earnings call to declare that Tesla was now the auto industry's leader in profitability and manufacturing efficiency, the crown Toyota held for three decades.

Toyota's incoming CEO, Koji Sato, faces a daunting task. He must accelerate the Japanese automaker's efforts to develop more competitive electric vehicles (EVs). But he will get little breathing room from Tesla or the Chinese EV manufacturers who are using their leads in EV technology and production costs to slash prices.

Tesla already earns roughly seven times as much per vehicle as Toyota. Its 17 percent pre-tax margins are roughly double the average for the rest of the industry. And after a rough 2022 for the company's shares, the stock has gained 28 percent to open up 2023.