Toyota, Subaru and Mazda commit to new engines geared towards electrification

Investing.com-- Japanese automakers Toyota Motor (NYSE:TM) (TYO:7203), Subaru Corp (TYO:7270) and Mazda) Corp (TYO:7261) said they had committed to developing new engines geared towards electrification and cutting carbon emissions, the three said in a joint statement on Tuesday.

The three will work towards developing engines that will better integrate motors, batteries and other electric components. The three will also work towards decarbonizing traditional internal combustion engines by making them compatible with more carbon neutral fuels. 

The planned engines are intended to be smaller in size and will allow for lower car hoods, improving performance, the three said.  

The announcement comes amid increasingly stricter emissions regulations across the globe, especially in key markets such as Europe. 

To this end, Toyota, the biggest automaker in the world by sales, saw a stellar performance in 2023 on the back of increased demand for its hybrid offerings, which the firm had pioneered over two decades ago with its Prius models.

Cost-conscious consumers were seen choosing cheaper hybrid offerings from Toyota over relatively expensive fully electric vehicles. But the automaker did provide a more sobering outlook for fiscal 2025, with sales expected to slow in the coming year. 

Japanese automakers have remained largely skeptical of fully electric vehicles, with Toyota in particular leaning further into its hybrid technology. The firm owns stakes in both Subaru (OTC:FUJHY) and Mazda, and also supplies the two with engines.