World’s biggest carmaker cancels EV saloon development amidst market uncertainties

The latest electric car model on the chopping block, Toyota has just announced that it’s pulling the plug on development of the Lexus LF-ZC – an EV saloon that was destined to take the fight to the all-new BMW i3 and Mercedes C-Class Electric.

Previewed at the 2023 Japan Mobility Show and originally set to reach production later this year, the LF-ZC was a fresh EV approach from the ground up. It showcased an all-new design for future Lexus models, as well as novel manufacturing techniques such as gigacasting, where large structural parts of the chassis would be manufactured in a single section – rather than having several smaller parts joined together on the production line.

Not only that, but the LF-ZC was to be Lexus and Toyota’s foray into solid-state battery technology for faster charging and higher energy density – meaning longer range versus the comparatively-sized liquid-based fare currently in production.

The brands will continue to develop the tech for future models, but this delay is just another hit to the progression of electric vehicle development amongst wide uncertainties in the EV market, globally. What hasn’t helped is Toyota’s difficult market share position in the Middle East, falling 92% year-on-year in April as a result of local conflicts. The brand is also feeling the pinch from falling demand in China and the loss of EV tax incentives in the US.

Combined with a consumer shift away from saloon cars, with buyers opting for SUVs instead, and it’s easy to see why the LF-ZC has joined the ranks of the IS, GS and LS saloons in the back catalogue of Lexus’ model range.

What’s happening to the EV market as a whole?

Toyota isn’t alone in its decision to scale back EV development, with other giants also pulling the plug on their electric futures until market demand shows signs of recovering:

Honda

Not only has the e:NY1 been pulled from sale in the UK, but in March of this year Honda announced that it was ceasing all development of the Afeela electric car brand, which was a collaboration with Sony.

On top of that, Honda also killed off its in-house EV projects in the Honda 0 SUV, Honda 0 Saloon and the US-specific Acura RSX SUV.

Ford

It isn’t just Japanese brands which have shifted away from electric cars, with American icon Ford massively scaling back its own EV plans, cancelling the F150 Lightning pick-up truck and forthcoming all-electric van in the US, too.

General Motors

Another US manufacturer that has decided to reduce its EV ambitions, GM cited the Trump administration’s cancellation of subsidies and tax-benefits to electric vehicle ownership as a cut in demand for battery-powered cars.

Luxury manufacturers

The Ferrari Luce may have just been announced, but in October 2025 the Modenese brand announced it would be winding down further development on other electric projects. Lamborghini, meanwhile, is pivoting towards plug-in hybrid technology instead – and Bentley is pushing back its all-electric commitment to 2035.

What does that mean for you?

In truth, nobody really knows. With so much money having already been invested into public infrastructure to support EVs, yet with manufacturers cutting their losses on long-term projects, there are a lot of sides with vested interests in a wide variety of outcomes.

Governments are attempting to maintain course for a zero-tailpipe emission world as soon as possible, yet are delaying deadlines as a result of manufacturer pressure and dwindling consumer demand for electric vehicles. The market could be heading for a stalemate of sorts, with no clear resolution in sight.

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