Toyota Motor Corp.'s incoming president, Koji Sato, said Monday the company will develop next-generation electric vehicles in 2026 in an apparent effort to catch up with its overseas rivals, which had bet on the potential of all-electric cars earlier on.

The new EV will be based on its high-end Lexus brand first, with a plan to launch all-electric versions of other vehicles later, Sato said in an online press conference.

Toyota Motor Corp.'s incoming president Koji Sato (C) and other officials gather for photos after a press conference on Feb. 13, 2023, in Tokyo. (Kyodo)

"We have been preparing to make battery electric vehicles that suit Toyota and Lexus," said Sato. "The time has finally come."

Toyota, the developer of the Prius, the world's first mass-produced hybrid passenger vehicle, has long been seen as reluctant to push forward with a shift toward all-electric cars.

The company has said carbon reduction should be undertaken in accordance with the needs of each country, noting that hybrid cars could be a better solution in areas where charging equipment is scarce, or there is a high dependency on fossil fuels to make electricity.

But in the face of ever-tightening environmental regulations and the rise of newer rivals, such as Tesla Inc., the Japanese automaker has gradually ramped up its EV efforts in recent years, setting a goal of selling 3.5 million EVs in 2030.

While Sato said Toyota's strategy to offer multiple options to customers has not changed, he emphasized the company will be more serious about making all-electric cars.

"The needs of battery electric vehicles are really high in the countries where the Lexus business is operating," Sato said. "Lexus will lead our battery electric vehicle effort, but it's not just an issue that concerns Lexus."

Toyota announced last month it will promote Sato, head of the auto group's Lexus brand operation, to president effective April 1, replacing current president Akio Toyoda, who will become chairman.

Related coverage:

Toyota profit falls despite record sales as rising costs bite

FOCUS: Toyota CEO taps younger successor amid paradigm shift in industry

Toyota to promote Sato to CEO, Toyoda to become chairman