Toyota’s EV sales more than doubled in a year, but gas cars are getting crushed in China

Toyota’s EV business grew rapidly through September 2026, but the company’s overall vehicle business weakened. Including Lexus, Toyota sold 309,766 battery-electric vehicles, up 127.4% from the same period in 2025. Total global sales, however, fell 3.4% to 7.51 million vehicles.

The contrast reflects Toyota’s still-small EV base and its dependence on broader vehicle demand. Updated electric SUVs and new models helped lift EV sales. The bZ4X, RZ, C-HR+, bZ4X Touring, Urban Cruiser, and Lexus ES EV all contributed to the expanding lineup.

China was the main drag. Toyota’s sales there fell 18.9% to just over 1.05 million vehicles during the first nine months. September marked the third consecutive month of lower global sales. Toyota also reported that China had suffered eight straight months of declining sales, especially for gasoline and hybrid vehicles.

A battery-electric vehicle, or BEV, uses electricity stored in a large rechargeable battery to power its motor. It does not carry a gasoline engine for propulsion. Drivers recharge it using charging equipment, and the vehicle’s driving range depends on its battery and energy use.

A gasoline vehicle gets its power mainly from burning fuel in an internal-combustion engine. A hybrid combines a gasoline engine with one or more electric motors and a battery. Depending on the type, a hybrid can use electric power briefly, but it still relies on gasoline. A plug-in hybrid can travel farther electrically before using its engine.

This distinction matters for Toyota’s results. The company’s BEV sales rose sharply, but its much larger gasoline and hybrid businesses weakened in China. The article reports 309,766 Toyota and Lexus BEVs through September, alongside 7.51 million total vehicle sales. Those totals include different powertrain types.

Toyota’s EV percentage growth looks impressive, but EVs remain a relatively small part of its overall business. Including Lexus, the company sold 309,766 BEVs globally during the first nine months of 2026. Over the same period, it sold 7.51 million vehicles of all types. Dividing those figures gives roughly 4%.

The scale difference explains why a 127.4% EV increase did not lift Toyota’s total sales. Toyota’s global results still depend heavily on gasoline and hybrid vehicles. Those products represent the larger sales base, so weakness in major markets can outweigh rapid growth in electric models.

China shows this effect clearly. Toyota sold just over 1.05 million vehicles there through September, down 18.9% year over year. The company’s EV lineup is expanding, but the article says gasoline and hybrid demand was particularly affected in China. EV growth therefore signals progress, not yet a business-wide turnaround.

Toyota’s sales in China fell because the market weakened, especially for the powertrains that still make up much of its business. Toyota said overall demand remained steady in some respects, but China’s market was weak. Rising gasoline prices were one reported factor, and gasoline and hybrid vehicles were particularly affected.

The result was a sharp decline. Toyota sold just over 1.05 million vehicles in China during the first nine months of 2026, down 18.9% from the same period a year earlier. September marked the company’s eighth consecutive month of lower sales in China. The decline helped pull global sales down for a third straight month.

Toyota does sell EVs in China through its GAC Toyota and FAW Toyota joint ventures. Those models include the bZ3, bZ3X, bZ5, and bZ7. However, their growth did not offset weakness across the wider market. China is Toyota’s second-largest market after the United States, making its decline especially important.

A major market can influence a carmaker’s total results more than a fast-growing but smaller product category. Toyota’s global EV sales rose 127.4% through September, yet total vehicle sales fell 3.4% to 7.51 million. The difference shows that EV growth had not become large enough to offset declines across the broader business.

China provides the clearest example. Toyota sold just over 1.05 million vehicles there during the first nine months, down 18.9%. The company said gasoline and hybrid vehicles were especially affected. Because Toyota’s established sales base remains much larger than its BEV base, falling demand for those vehicles can erase gains from new electric models.

This creates strategic pressure. Toyota’s EV lineup is expanding, and the bZ4X became one of the world’s 20 best-selling EVs through August. Still, China’s weakness pushed global sales lower for three consecutive months. Toyota is responding by adopting more Chinese EV technology and manufacturing methods.

Toyota, Volkswagen, and other established automakers are changing their approach because China has become a fast-moving and highly competitive automotive market. The article specifically identifies BYD as a competitor and says Toyota is increasingly adopting Chinese EV technology and manufacturing practices to compete more effectively.

Toyota plans to build a new Lexus electric SUV in China rather than Japan. Its Shanghai plant is expected to begin production next fall. The model will use advanced manufacturing methods, including gigacasting, which can cut costs and speed up production. These methods can help companies develop and build EVs more efficiently.

Volkswagen is facing similar pressure. Its China sales fell 38% in the third quarter to 405,800 vehicles. CFO and COO Arno Antilitz said Volkswagen must act quickly and decisively. The company plans to use technology developed in China for next-generation EVs, including models it intends to sell overseas.

Battery costs strongly affect an EV’s price, range, and profitability. Larger batteries can provide more driving range but add weight and expense. Charging infrastructure also matters: drivers need convenient, reliable access to recharge, especially for longer trips. These factors influence whether buyers choose an EV over a gasoline or hybrid vehicle.

Software controls many EV functions, including energy management, driver displays, and connected services. Efficient software can help use battery energy effectively and support updates after purchase. Manufacturing efficiency matters too. The article says Toyota’s planned Lexus EV will use gigacasting, an advanced method intended to cut costs and speed production.

These pressures help explain the industry’s shift toward Chinese technology and production methods. Toyota is trying to compete with companies such as BYD, while Volkswagen plans to use technology developed in China for next-generation EVs. The article does not provide battery-cost or charging figures, so their exact effects here cannot be measured.