Toyota warns of auto job losses from new EV push
Photo Credit – Toyota
The Real Cost of Electric Vehicles: Jobs on the Line
As the auto industry pivots toward electric vehicles (EVs), some significant consequences are emerging, particularly for jobs. Toyota, one of the industry giants, has long hesitated to go all-in on electric power. The company has delayed its EV targets, pushed back production, and continued to focus on hybrids. According to Toyota’s chairman, Akio Toyoda, one of the key reasons for this cautious approach is the potential for large-scale job losses.
Toyoda recently warned that a full transition to EVs could lead to the loss of millions of jobs, especially those tied to engine-related work. Gas-powered vehicles, with their complex engines, require significantly more labor to produce and maintain than electric motors, which are simpler in design.
In Japan alone, where 5.5 million people work in the automotive sector, the switch to electric vehicles could eliminate many engine-related jobs. Toyoda highlighted this issue, stressing that if EVs become the sole option, millions of skilled workers may find themselves out of work. Toyota, however, continues to develop gasoline and hybrid vehicles, a move that is keeping these workers employed for now.
Toyota’s Cautious EV Approach
Toyota has been more conservative with its EV rollout compared to competitors. While companies like Tesla push full-electric lineups, Toyota has pursued a “multi-pathway” strategy. This approach includes expanding hybrid offerings, adding hydrogen-powered vehicles, and launching new battery-electric models. The strategy reflects Toyoda’s belief that, while electric cars will play a significant role, they won’t dominate the market. He predicts that only 30% of vehicles on the road will be fully electric, with hybrids and hydrogen-powered cars making up the remainder. This diversified approach not only reduces the risk of job losses but also positions Toyota to adapt as market demands fluctuate.
This strategy has worked well for Toyota as EV sales globally begin to slow. Consumers in the U.S., Toyota’s largest market, continue to demand hybrids, which gives the automaker an advantage. As EV infrastructure struggles to keep pace with consumer needs, hybrids offer a practical alternative.
Honda Faces Major Recall Due to Steering Issue
Meanwhile, Honda, another major Japanese automaker, is dealing with more immediate concerns. The company has issued a recall for nearly 1.7 million vehicles across its lineup, including models like the Civic, CR-V, HR-V, and the Acura Integra. These cars, produced between 2022 and 2025, are being recalled due to a potentially dangerous steering issue.
The defect is related to a faulty part that can cause the steering to become “sticky,” increasing friction and making it difficult for drivers to control their vehicles. This issue stems from an improper annealing process during the production of certain worm wheel parts, leading to excess pressure and insufficient lubrication between key components. Fortunately, Honda has identified the problem and plans to address it by installing new worm gear springs and adding extra grease to the affected vehicles.
Concerned owners can easily check if their vehicle is under recall by using the National Highway Traffic Safety Administration’s (NHTSA) app or website.
BMW and Mercedes Hit by Sales Slumps
It’s not just Honda facing challenges in 2024. German automakers BMW and Mercedes have also reported drops in sales. Both companies attribute the decline to slowing demand in China, the world’s largest auto market. BMW’s sales fell by 13% in the third quarter of 2024, while Mercedes reported a 3% drop.
Chinese automakers are giving BMW and Mercedes stiff competition, offering cheaper models, especially EVs, that appeal to budget-conscious consumers. BMW saw its sales in China slump by a third, while Mercedes experienced a 13% drop. Mercedes also reported a dip in global battery electric vehicle (BEV) sales, which fell by 31%. BMW’s BEV sales, on the other hand, rose by 10% in the same quarter.
The sales slump has forced both companies to revise their annual forecasts, with BMW citing additional issues related to braking supplier Continental.
Tesla’s Robotaxi Reveal Faces Investor Skepticism
While Tesla’s upcoming robotaxi reveal has generated excitement, not everyone is optimistic. Investors are expressing doubts about the company’s ability to deliver on its autonomous vehicle promises. Over the years, Tesla has made bold claims about self-driving technology, but full autonomy remains elusive. Tesla’s Full Self-Driving (FSD) system is still classified as a driver-assistance feature, meaning it requires human intervention.
Many investors are concerned that Tesla has yet to overcome the technological and regulatory hurdles needed to make robotaxis a reality. Competitors like Waymo have made significant strides, but Tesla still has a long way to go. While the event may boost Tesla’s stock in the short term, analysts are skeptical about the company’s ability to maintain momentum.
Conclusion: The EV Shift Brings New Challenges
The shift to electric vehicles is shaking up the automotive world in ways that go beyond technological innovation. As Toyota’s chairman Akio Toyoda warns, the move to EVs could cost millions of jobs, especially in engine-related fields. Toyota’s cautious approach reflects a broader concern that the industry needs to balance innovation with job preservation.
Meanwhile, Honda is addressing safety concerns with its massive recall, and German automakers like BMW and Mercedes are feeling the pressure from Chinese competitors. Even Tesla, a leader in EV technology, faces challenges as investors grow wary of its autonomous vehicle promises.
The road to an electric future is filled with twists and turns, and the auto industry must navigate these challenges carefully to ensure a smooth transition.
