European pension funds assault Toyota for not going ‘all in’ on electrical vehicles


Toyota has come beneath recent hearth from large European pension funds over its opposition to going “all in” on electrical autos, as inexperienced activist traders put together for a showdown at this week’s normal assembly.

Once the pioneer of inexperienced expertise with the Prius hybrid launch in 1997, the Japanese automobile large has develop into one of the vocal critics of a speedy transition to battery-powered autos and the fiercest guardian of the petrol-electric hybrid expertise.

In the UK, Toyota has beforehand warned it might cease investing in its UK manufacturing unit, the place greater than 80 per cent of manufacturing is hybrid, if its expertise was banned from sale. The authorities has lately proposed that greater than half of all new vehicles offered within the UK should be absolutely electrical by 2028, however was criticised for not clarifying the way forward for hybrids.

Toyota additionally sided with former US president Donald Trump when he tried to roll again gasoline effectivity requirements. At dwelling, Akio Toyoda, its president who additionally heads Japan’s automobile trade foyer, final yr questioned the federal government’s resolution to ban new gasoline vehicles by 2035.

These lobbying efforts by Toyota have been a goal of AkademikerPension, the $20bn Danish fund; Sweden’s largest pension fund AP7, the $120bn Nordic asset supervisor; and the Church of England, which held a mixed $300mn shares in Toyota as of final yr.

“Toyota is jeopardising its valuable brand by lobbying against much-needed climate related regulation of the auto industry,” stated Anders Schelde, AkademikerPension’s chief funding officer final week. “What is the science based argument for their position, which is what we expect from companies if they are going against most expert views on the role of battery electric vehicles and the required timeline for phaseout of fossil fuel cars.”

Toyota’s hybrid system, which it has been promoting within the Prius for 20 years, is the explanation the Japanese large has one of many lowest common CO₂ emissions per automobile of any maker in Europe, regardless of not promoting a single absolutely electrical automobile till this yr.

The firm, which additionally invests in hydrogen-powered autos, has lengthy argued {that a} dramatic shift to electrical autos might lead to polluting the surroundings if vitality is sourced by fossil gasoline and hybrids present a greener answer for the transition interval.

But environmental teams and inexperienced activist traders argue that the trade can not afford to make detours, criticising Toyota for purchasing time till it could possibly reposition in electrical autos.

‘’If Toyota continues with outspoken . . . unfavorable local weather lobbying, it’ll alarm shareholders as such an strategy undermines the inevitable transition away from polluting vehicles,” stated Kiran Aziz, the pinnacle of accountable investments at KLP, one other investor in Toyota.

AkademikerPension had initially deliberate to submit a shareholder proposal for an annual evaluation of Toyota’s lobbying actions to the AGM on Wednesday, nevertheless it was rejected for lacking the deadline by sooner or later.

Since the proposal was rejected, the pension fund plans to query Toyota on the AGM on whether or not it’ll take steps to scale back reputational dangers from its lobbying actions and chorus from public statements that can undermine the transition to electrical autos.

Toyota final yr grew to become the primary carmaker in Asia to reveal its local weather coverage exercise, however local weather think-tank InfluenceMap nonetheless slapped the corporate with a “D” grade, arguing that it might miss its commitments to the Paris Agreement.

The Japanese automaker additionally outlined in December a plan to speculate $35bn into the shift in the direction of EVs and promote 3.5mn battery-powered autos yearly by 2030.

“We are committed to ensuring that national policies, societal needs, technological advances, and the needs of our customers all point in the same direction to the greatest extent possible,” Toyota stated, including that the final word objective was to scale back carbon emissions and the best way to attain this differed from area to area.

Toyota would proceed to evaluation its report on local weather coverage engagement by means of dialogue with shareholders, and deliberate to replace it yearly, it added.