Toyota’s commitment to diesel engines remains steadfast despite the global push toward stricter emissions regulations and the rise of electric vehicles. The company’s powertrain chief, Takashi Uehara, has clarified that there are no plans to end diesel development in the near future, and diesel hybrids may indeed be on the horizon.
Speaking at the Japan Mobility Show in Tokyo, Uehara emphasized that diesel engines are far from obsolete. “We don’t have a deadline – we are continuing our development and do not have a deadline to end the production or development,” he stated. This stance comes despite Toyota’s strong focus on electrification, particularly its petrol-electric hybrids, which dominate its lineup. Uehara noted that while the company is exploring battery-electric vehicles, the demand for internal combustion engines (ICE), including diesel, remains strong in key markets like Australia, Europe, and the Middle East.
Diesel vehicles currently account for 48.4% of Toyota Australia’s sales in 2025, a slight dip from 2024 but still significantly higher than the previous year. This regional demand underscores why Toyota is keeping its diesel engines in the mix. The company’s vice president in Australia previously suggested that diesel power could still play a role for about a decade before hydrogen technology takes over, aligning with Toyota’s broader “multi-pathway approach.” This strategy involves offering various powertrain options, including petrol, diesel, hybrid, electric, and fuel-cell electric vehicles, across its lineup.
Toyota is under increasing pressure to decarbonize, especially with regulations like Australia’s New Vehicle Efficiency Standard (NVES) penalizing high CO2 emissions. This has already forced some competitors to phase out diesel models in certain markets. However, Toyota is resisting the all-EV push, arguing that a mix of technologies better suits diverse global needs. Uehara stressed, “There is high potential for ICE – the mix of fuels that is highly accommodating of different types.” While Toyota hasn’t confirmed developing a diesel-electric hybrid, it hasn’t ruled it out, making this a possibility for the future.
The company is already dipping its toes into diesel electrification with models like the 48V mid-hybrid Prado and HiLux “V-Active” in Australia. These vehicles, while not labeled as hybrids, represent a step toward blending diesel with electric technology. Toyota’s stance comes as rivals face challenges with excess EV production capacity and financial losses, leading some industry experts to view Toyota’s balanced approach as more pragmatic.
While Toyota remains committed to diesel, Uehara acknowledged potential risks, such as stricter regulations and competition from hydrogen technology. “The cost for admission [to electrification] is going to be heavier and that may undermine the popularity of the diesel in the future – that’s a possibility,” he added. Nonetheless, the company plans to continue developing diesel engines, maintaining their “big torque” appeal while reducing CO2 emissions.
In summary, Toyota is navigating a complex transition toward a lower-carbon future without abandoning diesel. With diesel hybrids on the table and electrified diesel models already arriving in select markets, the automaker is betting on a gradual, diversified shift rather than an all-or-nothing gamble
