Toyota Redesigns America’s Best-Selling RAV4 SUV to be Fully Hybrid

Toyota Motor Corporation (NYSE:TM) has declared that it will only sell its updated 2026 RAV4 SUV as a hybrid or plug-in hybrid, doing away with conventional gas-powered models. America’s best-selling SUV, the RAV4, will continue to use a 2.5-liter four-cylinder engine with hybrid technology.

Workers assembling a car in a modern manufacturing plant, emphasizing the company’s sense of progress.

Strong consumer demand was mentioned by David Christ, head of Toyota North America, who noted that in 2024, hybrids will account for 44% of RAV4 sales and plug-ins for 6.5%. Toyota Motor Corporation (NYSE:TM) has not yet revealed the price of its upcoming U.S. sales. In 2024, the company’s RAV4 sales increased by 9.3% year over year to about 475,200 vehicles. The firm’s electrified vehicles made up 43.1% of its 2.3 million U.S. sales the previous year.

Toyota Motor Corporation (NYSE:TM)’s decision to switch to hybrid-only RAV4 models coincides with rising tariffs and a slowdown in the uptake of all-electric vehicles under President Donald Trump’s administration. Trump’s 25% tariffs have raised concerns about costs because 84.3% of RAV4s sold in the United States are now imported, primarily from Canada and Japan.

Toyota Motor Corporation (NYSE:TM)’s COO, Mark Templin, hinted that the company would boost RAV4 production at its Kentucky facility, but he did not disclose plans to mitigate tariffs.

According to Cox Automotive, the RAV4 continues to be one of the best-selling cars with just 29 days of inventory and high demand. Additionally, the switch to a hybrid-only model complements Toyota Motor Corporation (NYSE:TM)’s expanding lineup of seven other hybrid-only vehicles.

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