Toyota shuns electric cars with new generation of combustion engines

Toyota executives declined to say when the engines would launch or how much was being spent on them. 

But they said the investment was a “magnitude smaller” than what the company is currently pumping into EVs and battery technology, as it braces for tough competition from price-cutting Chinese rivals. 

The firm said the new internal combustion engines will be 10pc to 20pc smaller and designed to work best when paired with a battery-powered motor. 

Toyota’s continued focus on hybrids has angered climate activists but has proved popular with consumers, with strong sales propelling the company to a record profit of 5.3 trillion yen (£26bn) in the year to April.

In that period, about 34pc of its sales came from hybrids and plug-in hybrids, compared to about 1pc from battery electric vehicles. 

Only about 3,800 hydrogen fuel cell cars were sold, just 0.03pc of Toyota’s worldwide total. 

At Tuesday’s event, Subaru and Mazda Motor also unveiled smaller and more powerful engines. 

Toyota has separately unveiled plans to develop a so-called solid-state battery which it says could revolutionise EVs, providing much longer driving ranges and faster charging.

The company has vowed to launch more passenger EVs and ramp up sales in the coming years, with only one model, the bZ4X SUV, currently available. 

It is aiming to sell 1.5 million battery EVs by 2026, compared to about 117,000 last year, and 3.5 million by 2030.