Toyota last week published its annual review of its climate lobbying practices, called Toyota’s Views on Climate Public Policies 2023.  Has the company finally come clean and changed course?

First, some context. At its AGM in June 2023, several of its major shareholders voted for a resolution calling on the company to make these reviews of its climate lobbying much more rigorous and transparent, especially on whether it was aligned with the Paris Agreement, and aligned with Toyota’s own goal of becoming carbon neutral by 2050. The investors explained the business case for doing so:

“Such disclosures could serve to mitigate reputational and other risks, including potential backlash from customers, business partners, employees and investors associated with the Company’s climate-related lobbying activities in recent years.”

These investors hoped the company would listen, transparently convey where its lobbying was misaligned with climate goals, and change these practices.

However, a read of Toyota’s latest review shows that it is still, sadly, filled with false claims about the company’s lobbying stance, and false claims about climate science. 

 

CLAIM: “Toyota supports the Paris Agreement”

REALITY: Toyota is lobbying against the regulations required to meet the Paris Agreement.

Let’s look at a specific real-world example. The Paris Agreement goal of striving to limit global average temperature rise to 1.5C requires roughly halving global emissions by 2030, according to the IPCC, requiring deep decarbonisation of all sectors of the economy.

In the world’s 2nd largest emitting country, the US, the biggest emitting sector is transport, led by passenger vehicles. To get even close to a Paris Agreement-aligned emissions pathway requires a rapid phase-out of the sale of new fossil-fuel cars, to make sure that only zero-emission vehicles are added to the road by 2035, according to the IEA. 

The Biden Administration’s flagship climate policy of tougher tailpipe emissions standards gets pretty close to this-  the proposed rules would require between 64% to 67% of new car sales to be zero emission by 2032, paving the way to a fully zero-emission market in the 2030s.

However in a July 2023 consultation response, Toyota opposed the EPA’s proposed higher GHG emissions standards for light-duty vehicles, advocating to reduce proposed zero-emission 2030 and 2032 vehicle penetration rates. (source: InfluenceMap).

Then in an October 2023 US consultation response, Toyota also opposed higher proposed US Corporate Average Fuel Economy (CAFE) standards for cars and light trucks, advocated to maintain numerous flexibilities that would weaken the rule’s stringency, and appeared to question the legality of the rule. (source: InfluenceMap).

The reality is that Toyota is lobbying the US to not implement emissions reductions aligned with the Paris Agreement. If the company succeeds, and the 2nd biggest country emitter in the world surges past safe climate guardrails, scientists say there are global consequences for us all.

Moreover, the arguments that Toyota is using in this lobbying are also unscientific: For example it is trying to scare US policymakers into thinking there is a scarcity of the minerals required to make enough EV batteries to meet its proposed timeline.

“Toyota believes the final regulations must account for key issues, such as the scarcity of minerals to make batteries, the fact that these minerals are not mined or refined in the U.S., the inadequate infrastructure, and the high cost of BEVs.” (Source: Toyota submission to EPA)

This is false – there is not a scarcity of nickel, cobalt, or lithium constraining the rapid scale-up of EV sales, according to pure-electric automakers like Tesla, who support the EPA proposal, and according to the world’s scientific community in the IPCC.

As the IPCC report 2023 puts it, “The environmental footprint of battery production and growing concerns about critical minerals can be addressed by material and supply diversification strategies, energy and material efficiency improvements, and circular material flows (medium confidence).” (section 4.5.3).

Which brings us on to…

CLAIM: “Toyota… is conducting public policy engagement activities based on the scientific findings of the IPCC.”

REALITY. Toyota’s policy engagement is not based on the scientific findings of the IPCC. 

The IPCC’s latest 2023 report states, “Electric vehicles powered by low-emissions electricity offer the largest decarbonisation potential for land-based transport, on a life cycle basis (high confidence).” (section 4.5.3 -)

In comparison, Toyota publicly argues against a full transition to EVs, refuses to give a date by which it will move to 100% EV sales, and instead argues that a “multi-pronged approach” of continued combustion engine cars including 100% petrol hybrids, and plug-in hybrids, can actually reduce emissions faster than EVs: “The data shows a more effective approach to reduce more carbon sooner is to promote a multi-pathway strategy (PHEV, HEV, BEV and FCEV).”

The IPCC’s detailed lifecycle analysis of each of these rival technologies shows that Toyota’s claim is categorically false.

Moreover, since its 2023 AGM the company has expanded its misleading, pseudoscientific marketing of 100% petrol-fuelled hybrid vehicles as “electric” or “electrified”, contradicting the IPCC’s own definition of an electric vehicle. As Public Citizen explained in their complaint to the US advertising regulator about Toyota, “If manufacturers categorize cars that run primarily or entirely on fossil fuels as ‘electric’ or ‘EVs,’ then what do those words even mean?”

Toyota tries to argue that the IPCC supports its “multi-pronged approach” as follows:

“The latest Sixth Assessment Report of the United Nations Intergovernmental Panel on Climate Change (IPCC), a scientific review of the world’s latest findings, states that in addition to BEVs powered by low emissions electricity, the use of sustainable biofuels, low emissions hydrogen, and derivatives (including synthetic fuels), and fuel efficiency improvements are also effective ways to mitigate GHG emissions.”

But this is false: the IPCC 2023 AR6 report actually describes these as potential options for “shipping, aviation, and heavy-duty land transport,” not passenger vehicles.

“Sustainable biofuels, low-emissions hydrogen, and derivatives (including synthetic fuels) can support mitigation of CO2 emissions from shipping, aviation, and heavy-duty land transport but require production process improvements and cost reductions (medium confidence).” (section 4.5.3)

In the context of passenger vehicles, the IPCC makes clear that none of these suggestions are as effective at reducing emissions as EVs.

Let’s touch on Toyota’s view on hydrogen. In its review of its lobbying stance, it says of hydrogen: ” We believe that these technologies have the potential to expand the options for achieving carbon neutrality at an early stage… “

But this is false, at least in the cars context: Toyota publicly admitted at the Japan Mobility Show that its hydrogen passenger car Mirai has not been successful, so it is pivoting to heavy duty uses now. 

CLAIM: “We support regulations that are predictable, technology neutral, and that allow us to provide safe and affordable vehicles to our customers.”

REALITY – Toyota opposed exactly this type of technology-neutral zero-emission vehicle regulation in the UK last year, while most other automakers supported it.

In a May 2023 public UK consultation response found via FOI request, Toyota advocated to effectively delay the UK’s ZEV mandate by pushing for 2024 to be a monitoring year only, alongside pushing for a weaker mandate trajectory for cars, and emphasizing concerns around the proposed trajectory for vans. In the same consultation, Toyota advocated weakening the UK’s ICE phase-out policy by including the sales of ICE-powered hybrids from 2030-35. (Source: InfluenceMap)

There is no transparent acknowledgement by Toyota in its disclosure document that it lobbied to weaken and delay this regulation, even though it was the most important policy required for the UK to meet the Paris Agreement – according to the UK government’s own climate advisory body.

There is no apology, or even acceptance that this lobbying stance was wrong. 

Third-Party Evaluations of Industry Associations

Toyota’s review finds that the Alliance for Automotive Innovation (AAI) and many other lobby groups it pays are “aligned” on the goal of Consistency with the Paris Agreement, on the basis that they have made a statement of support for Net Zero carbon emissions by 2050.

But it doesn’t investigate whether these statements are actually true, it just takes them at face value. This is not a serious review of the activity of its lobby groups. As the UN High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities found, a statement of support for Net Zero by 2050 on its own is completely inadequate to assess whether any organisation or company is actually acting in line with climate science, and is often simply greenwashing to obscure bad corporate behaviour.

Even on its own terms, “Net Zero by 2050” is an inadequate description of the Paris Agreement temperature goals, which to be met require almost halving emissions this decade, according to the IPCC. Many of the regulations that AA and other associations Toyota belongs to are lobbying to weaken or prevent the climate policies required for this urgent short-term action this decade.

In summary, Toyota’s published response to investor pressure for more transparency about its climate lobbying:

–Contains many demonstrably false claims

–Fails to disclose or acknowledge recent, documented negative lobbying efforts

–Tries to distort IPCC climate science to suit its own commercial interests.

This suggests a serious corporate culture issue, and leadership issue, that the company needs to address for the good of its shareholders and the planet.