Toyota last month made a surprise announcement: It would stay in the minicar segment with a new model and continue offering internal combustion engines.
This news would have barely raised an eyebrow a few years ago, but Europe’s entry segment is undergoing a rapid transformation.
The shift to battery power will happen so fast for minicars that by 2026 more than 50 percent of all sales in the segment will be full electric, up from 15 percent in the first two months of 2021, analyst firm LMC Automotive predicts.
Simultaneously, LMC forecasts that minicar demand will be halved by 2026 to less than 500,000 from 1.1 million in 2019, in part because of the higher cost of battery-powered variants.
The segment’s 34 percent decline last year was a signal of what is to come. “We do not expect A-segment [minicar] sales to bounce back,” LMC senior analyst Sammy Chan said. “2020 provided a snapshot for what is likely to be the future of the segment.”