By Tadashi Isozumi and Hironari Akiyama / Yomiuri Shimbun Staff Writers
BRUSSELS -- Last December, the European Union effectively withdrew its plans to ban from 2035 the sale of combustion-engine vehicles using fuels including gasoline. Sales of vehicles, such as those running on gasoline, hybrid vehicles (HVs) and plug-in hybrid vehicles (PHVs) -- which use steel with reduced carbon dioxide emissions during manufacturing, will now be allowed up to a certain quota.
Yoshihiro Nakata, president and CEO of Toyota Motor Europe NV/SA, which oversees Toyota Motor Corp.'s European operations, called for the further easing of regulations during an interview with The Yomiuri Shimbun. The following is excerpted from the interview.
'Promote use of carbon neutral fuels'
The Yomiuri Shimbun: How do you view the EU's policy change?
Yoshihiro Nakata: The withdrawal itself is welcome. However, the requirement to make about 90% of vehicles zero-emission maintains a significant gap with customer demand.
I think we should push for further relaxations alongside such parties as automakers in Germany and other nations, as well the Japan Automobile Manufacturers Association, while strongly promoting the use of carbon-neutral fuels, particularly biofuels.
Europe is progressing relatively faster than other regions in the shift to electric vehicles (EVs). EV sales have grown to account for about 20% (of new vehicle units sold). However, circumstances vary by country. Wealthier nations such as Germany and France will likely accelerate (adoption), including through the development of (charging) infrastructure and government subsidies. But when considering countries like Greece and Poland, I believe actual demand will not keep pace given the current situation.
While CO2 emissions from vehicles are regulated, I think the correct approach is to adopt life cycle assessment (which evaluates the environmental impact including from the procurement of raw materials to production and disposal). Manufacturing EVs also involves CO2 emissions. Immediate change is difficult, but we must engage in discussions with the EU.
Yomiuri: Do you think the manufacturers' lobbying efforts led to the EU's policy shift?
Nakata: I believe so. European automakers shifted (management) resources to EVs about three years ago, but actual demand hasn't kept pace (to the extent). Meanwhile, competition with Chinese manufacturers is intensifying.
Exports to China are also declining. The sustainability of the European economy and the auto industry itself is under threat, and European manufacturers are suffering financially. In this environment, the understanding that they must act or risk losing competitiveness is gradually growing.
'Product supply couldn't keep pace in EV market'
Yomiuri: In 2025, Toyota saw its EU market share (including high-end Lexus models) drop to 7.4% from 8% in the previous year. What do you think is the cause?
Nakata: When including commercial vehicles, we maintained our share compared to 2024, but passenger cars saw a decline in share. There are two factors. While the EV market is expanding to account for 20% (of the overall auto market), we were not able to keep pace in terms of our product lineup. We were essentially competing with just two models: the bZ4X and the Lexus RZ. Additionally, in segments including the RAV4, global demand for HVs and PHVs surged, and we couldn't keep up with the supply of these models.
In 2026, we will introduce new EVs and fight back. We will strengthen our lineup with the bZ4X Touring, C-HR+, Urban Cruiser and Lexus ES. We will also tackle supply with a strong sense of urgency, communicating closely with the main office (in Tokyo).
'Chinese PHVs are price-competitive'
Yomiuri: What are your views on Chinese manufacturers? Their share in the EU is still low, but their growth rate is high.
Nakata: China faces a tightening domestic market, so the entire country is pushing outward. Since they face high hurdles in the United States (due to high tariffs), they're targeting Europe, Asia and Latin America. Their products have price competitiveness and are entering at low prices. The EU imposes high tariffs on EVs from China, so the price of Chinese EVs isn't that different from our EVs.
On the other hand, the high tariffs don't apply to PHVs and some other vehicles, so they're targeting that segment. Their PHVs are priced about 30% lower than ours. Toyota also finds itself in a situation where it must spend more on sales costs compared to last year.
Yomiuri: Do you perceive Chinese players as a threat?
Nakata: They are a threat. Globally, (Chinese EV maker) BYD is expanding at an incredible pace. Their sales network is also growing rapidly. We're seeing things like independent distributors handling Toyota vehicles selling BYD vehicles as well.
'FCVs offer better usability than EVs'
Yomiuri: How do you view the potential for hydrogen in the European market?
Nakata: Europe will completely phase out natural gas from Russia. There's major concern about how to replace that energy. While electricity is the primary focus, there's also the issue of not being able to fully respond to fluctuating demand. Within the question of how to secure energy, hydrogen remains a key axis.
Fuel cell vehicles (running on hydrogen) have a faster refueling speed compared to EVs. They excel over long distances and have strong towing capacity. For the aim of reducing commercial vehicles' CO2 emissions, hydrogen offers better usability for customers than EVs.
Without sufficient (demand) for hydrogen, it's not viable for hydrogen producers including hydrogen stations. Conversely, without such infrastructure, it would be inconvenient for the mobility (users') side. I believe it's crucial to advance both simultaneously, receiving government support during the initial investment phase.
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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.
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February 12, 2026 04:47 ET (09:47 GMT)
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