| Thanks for reading Hyperdrive, Bloomberg's newsletter on the future of the auto world. It's been slim pickings lately with respect to positive developments for electric vehicles. One automaker after another has walked back sales targets, issued profit warnings, and pleaded for EV subsidies or relief from emissions rules. Others are delaying or altogether scrapping new products or plants, and their battery suppliers are reeling. The world's biggest car manufacturer warned this was coming — that the transition to EVs would be bumpier than the conventional wisdom was a few years back. This company happens to be having a field day selling the gas-electric hybrid models Elon Musk dismissed a short while ago as a passing fad. I'm referring of course to Toyota, whose conventional hybrids like the Prius have been doing most of the heavy lifting behind this trend: In the US, Toyota's electrified vehicles — hybrids, plug-in hybrids, fuel cell and battery-electric models — are on the verge of outnumbering its autos powered entirely by internal combustion engines. Two years ago, electrified vehicles were less than 20% of the company's September sales. Last month, the share soared to 48%. Toyota hasn't gotten everything right. Fuel cell vehicles have failed to take off anything like the company hoped. Battery-electric vehicles are no doubt going through some growing pains, but the automaker has largely missed out on them becoming a significant force in some of the world's most important markets. But Musk was dead wrong when he declared two years ago that it was time to move on from hybrids, calling them a phase. Millions of car buyers are deciding otherwise, leading Toyota to transition some of its best-selling vehicles to hybrid-only. It's only a matter of time until Toyota customers will be able to pick any powertrain of their choosing, so long as it's at least a hybrid. "In the US, there is a decision being made now — and I'm not a part of it — as to whether to stop making pure ICE for the US market," Gill Pratt, Toyota's chief scientist, told me in an interview. "Just the fact that we're thinking of that means that, OK, it must be close."  Gill Pratt. Photographer: Buddhika Weerasinghe/Bloomberg Pratt is clear-eyed about the implications of overly bullish EV predictions proving to have been wishful thinking. During the hottest August on record, he promised to leave attendees of events Toyota was putting on between the Olympic and Paralympic Games in Paris "thoroughly depressed" by the amount of carbon-dioxide emissions accumulating in the atmosphere. "If you're not scared by this curve, then you're not seeing it right," he said. Toyota is moving full-throttle to open a massive $13.9 billion battery factory in North Carolina that will supply cells both to fully electric and hybrids, Pratt told me. He's encouraged that spot prices of battery raw materials have been falling, alleviating what has far and away been automakers' biggest concern with respect to EV input costs. And he's downright effusive about renewable power, lauding the progress being made in solar, wind, nuclear and geothermal energy generation. Pratt dismisses criticism of synthetic fuels and biofuels on the grounds that they're inefficient to produce. Yes, direct electrification is far more efficient, but he expects there to be an excess of renewable energy available that could be used to make low-carbon liquid fuels. Assuming those fuels could be pumped into the roughly 1.25 billion cars on Earth — the vast majority of which aren't electric, and won't be for decades — presents an underappreciated opportunity to dramatically lower CO2 emissions. "What I'm trying to emphasize in my talks now is please, please, please, we all want the same thing, but let's stop the wishful thinking," Pratt said. "Let's think about what really is going to occur, what human nature is like, what politics is like, the capital that folks don't have to change their cars, and let's find a way that accepts the reality of all those things, and let's change what we actually can change."  Stellantis CEO Carlos Tavares. Photographer: Nathan Laine/Bloomberg In his first public comments since Stellantis confirmed it had started searching for his successor, CEO Carlos Tavares signaled he's open to exiting just over a year from now. Leaving the company when his contract expires in early 2026 is "one option," Tavares told reporters Thursday at a press conference in Sochaux, France. When asked whether he may step down before then, the 66-year-old responded: "I signed a contract." Read More: Italy output plunges ahead of CEO's meeting with lawmakers. | 
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