Toyota is preparing to become an engine supplier for other automakers, marking a shift in its strategy as it develops a new generation of compact combustion engines.
The Japanese automaker is working on three new inline-four engines. These include naturally aspirated and turbocharged 1.5-litre units, alongside a more powerful 2.0-litre turbocharged engine.
The engines are designed to meet upcoming Euro 7 emissions standards and support carbon-neutral fuels. Toyota also intends to pair them with its existing hybrid systems, allowing other manufacturers to adopt the technology.
According to Automotive News, the new engines and hybrid systems could become available to automotive partners as early as 2027. Subaru, Mazda, Suzuki and Daihatsu are among the potential customers, although Toyota has not confirmed any agreements.
The 1.5-litre engines are primarily intended for hybrid applications. Meanwhile, the 2.0-litre turbo could operate independently or alongside an electric motor in a hybrid setup.
Toyota is also focusing on reducing engine dimensions. The smaller packaging allows manufacturers to install the powertrains in different vehicle platforms, including those originally developed for electric vehicles.
This approach gives automakers more flexibility to offer combustion, hybrid and electric powertrains using similar vehicle architectures. It also allows manufacturers to continue using combustion engines while working towards stricter emissions requirements.
Toyota Wants to Triple Engine Sales Revenue
Toyota’s plans extend beyond supplying engines to its existing partners. The company reportedly wants to expand its engine business from US$560 million (approximately RM2.37 billion) to US$1.7 billion (approximately RM7.19 billion) by 2032.
However, potential customers may still have their own powertrain development plans. Subaru and Mazda already use selected Toyota technologies, but both companies are also developing new engines of their own.
This could create competition between Toyota’s proposed engine range and the powertrains being developed by its partners.
Arene Software Platform Also Expanding
Toyota is also planning to expand its Arene software platform. The company reportedly aims to increase its application from two model nameplates to 50 by 2030.
The target also includes reaching 10 million vehicles annually using the platform. Toyota could eventually share the technology with its alliance partners.
Together, these plans indicate that Toyota wants to expand its role beyond manufacturing vehicles. The company is looking to supply engines, hybrid systems and software technologies to other automakers.
