Toyota Open to Selling Its Next-Gen Engines to Other Automakers
It’s no secret that Toyota has long been a leader in engine development. The company was also ahead of the curve when it came to developing its hybrid systems. This has given the company a sizable advantage over its rivals. It also allowed Toyota to become a pioneer in the hybrid vehicle market.
A new report suggests Toyota could now be open to selling its next-gen engines and hybrid systems to other automakers. It’s an attempt to expand its streams of revenue and make more profits while enduring uncertain market conditions.
Toyota’s Gambit Builds on Precedent
According to the report from Automotive News, Toyota wants to sell its next-generation engines and hybrid systems to other automakers. The company expects to make around $1.7 billion a year in external powertrain sales by 2032. That would be a noticeable tick up from the roughly $562 million in orders Toyota is targeting this year.
Toyota has sold hybrid systems to other automakers before. For example, the Mazda CX-50 hybrid uses the RAV4’s engine and hybrid system. However, the reported plan suggests Toyota wants to push its sales efforts in a more aggressive direction. The goal is to lure in more automakers with the core benefits its engines and hybrid technology offer.
What Makes the Next-Gen Engines So Special?
According to the report, the next-gen engines have a key advantage over their current counterparts: they are narrower and shorter. While this might not seem that important at first glance, these traits will allow them to fit into smaller vehicles. Some vehicles were designed as EVs first. Adding a gasoline-powered model with one of these engines would improve flexibility. It would also let the automaker create a second profit stream alongside the all-electric version.
Smaller Engines Take the Spotlight
With all of this potential flexibility on hand, look for Toyota to keep things simple with the engines themselves. Prior rumors suggest they will be a pair of 1.5-liter four-cylinders. One would be naturally aspirated, while the other would be a turbocharged variant geared toward performance vehicles. A bigger 2.0-liter turbocharged engine is also coming. However, look for the bulk of the spotlight to shine brightly on the smaller engines first.
New Engines Will Be Unifying Force
In addition to all the things the new engines offer individually, the powertrains will also help break down a long-standing wall that has existed at Toyota. That wall comes in the form of how Toyota makes its platforms. Its hybrid and EV offerings ride on separate dedicated platforms, which let the models showcase their strengths but never venture into each other’s turf.
That’s slated to change. Toyota is reportedly working on a new platform designed from the ground up to work with both EV and hybrid applications. This new underpinning would not only help simplify production by removing excess platforms, but also allow Toyota to have better production at scale and a more streamlined revenue source.