Toyota will focus on developing local production and supply chains in China and the United States to boost electric vehicle sales.
The new President and CEO of Toyota Motor Corporation (TMC), Koji Sato, revealed the Japanese automaker’s plans in the electric vehicle market (EVs).
Toyota remained the top-selling automaker in the world for three consecutive years in 2022. However, the rise of battery electric vehicles (BEV) might threaten Toyota’s crown. The Japanese automaker has been a little late in joining the BEV race. This year, though, Toyota appears to have realized the potential of BEVs in the auto industry.
Earlier this month, TMC announced the launch of 10 new BEVs with a target sales goal of 1.5 million units by 2026. Toyota aims for significant growth in the BEV market. It is a smart move, considering that BEVs might be the future of the whole auto industry. Many countries are choosing to phase out internal combustion engine vehicles and support clean, energy-efficient cars.
Part of Toyota’s strategy for growth includes localization in China and the United States.
“In areas where there is an acceleration in the shift towards battery EVs, like China and the US, we need to be bold with local production,” said Toyota’s new CEO in a group interview over the weekend.
China’s Place in the BEV Market
The Chinese auto market is the world’s largest vehicle market, making it a prime target for Toyota’s goals. China is vigorously supporting clean energy vehicles, including BEVs and plug-in hybrids.
Japanese automakers posted the sharpest sales decline in China against foreign brands. The Financial Times attributed Toyota’s sales decline to its slow rollout of BEVs. FAW Toyota and GAC Toyota in China ranked 9th and 10th—respectively—in the China Passenger Car Association’s (CPCA) list of Top 10 Chinese automakers by retail sales. For comparison, Tesla–which only sells BEVs–ranked 7th place.
The CPCA reported Toyota’s 23.5% year-over-year (YoY) decrease in sales in January–including ICE and BEV sales. By February, Toyota reported a decline of 12.2% YoY in sales, with a slight increase of 0.9% year-to-date (YTD). Lastly, in March 2023, Toyota sold 136,400 units in China, down 18.5% YoY. Its sales volume in China by the end of Q1 2023 was 379,900, down by 14.5% YoY.
The US IRA’s Impact on the BEV Market
The United States has also shown full support for battery electric vehicles, specifically with the Inflation Reduction Act (IRA). The IRA provides incentives to support BEV production within the United States or any country with a free trade agreement with the US. It also includes tax credits for BEV purchases.
The IRA has significantly affected the BEV market worldwide since it passed. Many companies outside of the United States have already started working with American companies to build BEV components in the United States. For instance, South Korean battery supplier LG Energy Solutions is working on the construction of battery production facilities in the United States with Ford and Tesla.
Toyota Motor North America (TMNA) reported saw an uptick in electrified vehicle sales in the first quarter. In March, electric vehicles made up 27.5% of TMNA’s total sales volume. TMNA sold a title of 469,558 vehicles in Q1 2023, down by 8.8% by a volume and daily selling rate (DSR) basis. It sold approximately 118,836 elective vehicles, accounting for 25.3% of total sales volume.
“With 22 electrified vehicle options between both the Toyota and Lexus brands, the most among any automaker, we’re giving customers a choice that fits their lifestyle, pocketbook and needs,” said Jack Hollis, TMNA’s executive vice president of sales. “We continue to make improvements to our vehicle inventory to satisfy customer demand, while doing all we can to exceed expectations as we introduce more electrified vehicles throughout the balance of 2023.”
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Tesla released the Full Self-Driving v14 ‘Lite’ suite to owners of Hardware 3 or AI3 vehicles today, adding several new features to the vehicles that were once believed to be capable of unsupervised self-driving.
Now, Tesla has released this modified suite to older Tesla vehicles, adding plenty of new features and capabilities.
Here are the full release notes for the suite:
- Distilled the intelligence from HW4 V14 into HW3. This allows HW3 to directly learn how to handle scenarios using HW4 V14 as a guide. This process unlocks the improvements that have been made to HW4 including Reinforcement Learning (RL) and offline models for HW3.
- Improved both proactive and reactive responsiveness across a wide variety of categories including navigation handling, merges and forks, pedestrian interactions, traffic lights, and vehicle cut-in scenarios.
- Improved general comfort in nominal scenarios through fewer false slowdowns, smoother steering and more consistent lane centering.
- Introduced parking, unparking, and reversing capabilities.
- Added Arrival Options for you to select where FSD should park: in a Parking Lot, on the Street, in a Driveway, or at the Curbside.
- Speed Profiles are now available at all times, to further customize driving style preference.
These improvements, according to Tesla’s Head of AI, Ashok Elluswamy, help distill the driving behavior from AI4’s v14 series into both the camera and compute configurations of AI3.
Tesla Full Self-Driving v14 ‘Lite’ for older cars finally gets released
He added:
“It includes destination options and speed profiles on city roads, but more importantly significantly improved safety. We hope you’ll enjoy it, once the build ships wide.”
FSD v14 Lite is now rolling out to AI3 early-access customers. Based on the feedback, will rollout to more customers over the next few weeks.
This build distills the driving behavior from AI4’s v14 series into both the camera and compute config of AI3. It includes destination…
— Ashok Elluswamy (@aelluswamy) June 29, 2026
Tesla will continue to roll out the v14 Lite suite more widely in the coming weeks, the company said.
Tesla has finally released its Full Self-Driving v14 ‘Lite’ suite for older cars that equip the Hardware 3 or AI 3 chip, which have not been able to handle the newest versions of the company’s driver assistance software.
Tesla officially started releasing the v14 Lite suite to owners in the Early Access Program last night. The company’s Head of AI, Ashok Elluswamy, said that the rollout will continue over the next few weeks. The build distills the driving behavior from AI4’s v14 series into both the camera and compute configurations of an AI3 car.
🚨 Tesla is releasing v14 Lite for AI3 owners who are in early-access
This will give AI3 cars the ability to experience new FSD features like parking preferences. https://t.co/pp6Q5FOKoz pic.twitter.com/tqexMB8SVy
— TESLARATI (@Teslarati) June 29, 2026
It also includes a variety of new features that were available to AI4 cars running v14, including:
- Start Self-Driving from Park
- Arrival and Parking Options
- Speed Profiles
The release is highly anticipated because those owners with AI3 vehicles were early adopters into the FSD platform and were promised that their cars would be capable of achieving Full Self-Driving.
However, Tesla CEO Elon Musk admitted during the company’s recent Q1 Earnings Call that these vehicles would not be capable of achieving unsupervised Full Self-Driving, which is what Tesla had originally said.
Owners were not pleased with this answer, or the idea that their commitment to buying the suite outright for thousands of dollars would not yield the ability to drive without operating the car. Tesla gave some solutions for this, including a discount on a new car, or an upgrade to an AI4 or AI5 self-driving computer and new, upgraded cameras.
Tesla owners do not seem pleased with these options, as they require giving the company more money.
Nevertheless, it is important to note that Tesla came through for owners here by releasing v14 Lite before the end of Q2, something it had promised owners during the previous Earnings Call. Tesla has had trouble keeping up with timelines, but this is a big achievement for the team.
Tesla released what analysts believe the company will report in terms of deliveries and energy deployments for Q2, but the figures seem to confirm a long-standing theory on the company’s vehicle division.
For years, Tesla was just looked at as a car company. Now that it has established itself as a powerhouse in energy, AI, and tech as a whole, the company is now less hellbent on achieving quarterly growth, on a sequential basis, at least from a major standpoint.
Tesla topped out its annual deliveries in 2023 at 1.81 million, and in the two years since, the company has reported a decrease in deliveries for the entire 12-month term both times.
With Tesla delivering 358,023 cars in Q1, a 6.3 percent increase over Q1 2025, but falling short of Wall Street expectations at 365,000-370,000 units, the narrative around vehicle deliveries and their importance continued to change earlier this year. Some might say it is convenient, but others might say it is the typical evolution of a company that continues to change over time.
For Q2, Tesla’s delivery consensus estimates sit at 406,024 units, analysts believe. They were surveyed from Daiwa, DB, Wedbush, Cowen, Canaccord, Baird, Wolfe, BMP Paribas, Goldman Sachs, RBC, Evercore ISI, Barclays, Bank of America, Wells Fargo, Morgan Stanley, Truist, UBS, Jefferies, JPM, Needham & Co., HSBC, and William Blair.
Credit: Tesla
Tesla is also expected to report deployments of 13.8 GWh this quarter.
The change to Tesla’s overall narrative now leans less on vehicle deliveries and more on its other projects. Most notably, Tesla’s Robotaxi project has taken the priority over most of its other business ventures, and investors and the public are more concerned about the deployment of vehicles into the fleet, the operation of a driverless ride-hailing service, Cybercab production and operation, and expansion into new cities.
Tesla analyst realizes one big thing about the stock: deliveries are losing importance
This big narrative switch happened when Tesla indicated it was looking at making transportation a service by launching a ride-hailing service that will operate using Tesla’s Full Self-Driving suite. Once unsupervised operation begins, Robotaxi could be a new way for people to get around, all without a driver in their car.
Instead, they will rely on the billions of miles Tesla has accumulated from its real-world fleet.
It is important to note that Tesla remains significant in the automotive sector, and deliveries must continue as they have for years. Tesla still has a strong automotive business and needs to execute further on all facets to keep its investors happy.
Tesla Full Self-Driving v14 ‘Lite’ Release Notes: new capabilities and features
Tesla Full Self-Driving v14 ‘Lite’ for older cars finally gets released
