Electric Toyota Kluger launch delayed due to slowing EV demand - report

Toyota has reportedly delayed production of a three-row electric SUV in the US amid cooling demand for battery-powered vehicles and surging hybrid sales.

Earlier this year, Toyota’s US division announced it would invest US$1.3 billion (A$2 billion) towards preparing its Kentucky factory to produce a three-row electric SUV.

Nikkei Asia reports Toyota initially planned to start production of the three-row SUV in Kentucky from 2025, however suppliers have now been told the electric vehicle (EV) won’t launch until the first half of 2026.

A report in April by US publication CarBuzz claimed the Toyota Highlander – as the Kluger is known overseas – would lend its name to the electric model, which has been expected to be sold alongside a new generation of the petrol/hybrid SUV.

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Toyota’s Kentucky factory currently produces the Toyota RAV4 and Camry – plus the closely related Lexus ES – for the North American market, while the Highlander/Kluger is produced in Indiana for all markets bar China, where it’s assembled locally.

We may have already seen what could become the electric Kluger in the form of the bZ Large SUV concept, revealed in December 2021 among 15 other Toyota and Lexus prototypes.

CarBuzz reported there would be a Lexus based on the electric Kluger, reportedly named TZ, however Nikkei Asia now says the luxury division won’t produce any battery-powered SUVs in the US before 2030, instead importing its EVs from Japan.

Last month, Nikkei Asia reported Toyota’s forecast of 1.5 million EV sales annually by 2026, announced in April last year, has been cut by one third to one million annual sales.

While it didn’t cite a source for the revised targets, it reported the decision was “prompted by the slowdown in the global EV market,” and that “Toyota has notified its parts suppliers of the decision.”

According to the report, Toyota will produce slightly more than 400,000 EVs in 2025 before increasing its output to one million the following year.

EVs accounted for just 104,018 – or less than one per cent – of Toyota’s record-breaking 11,233,039 global sales in 2023, while the hybrid technology championed by the brand contributed 3.42 million sales to the total.

Such is the popularity of Toyota’s hybrid vehicles in Australia that the carmaker earlier this year announced it would no longer sell petrol-only versions of models where hybrid drivetrains are available, which included the Kluger.

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