Toyota shares soared to a 16-month high Wednesday after shareholders of the world's largest car manufacturer voted to retain Akio Toyoda as its chairman in a broad endorsement of the company's governance and new electric vehicle strategy.
Shareholders also rejected proposals to seek greater disclosures on the Japanese automaker's climate lobbying, while also voting in favor of all 10 proposed members of the board at the company's annual general meeting in Toyota City — Koji Sato's first as Toyota's chief executive.
Ahead of the meeting, Toyota unveiled Tuesday sweeping plans to develop high performance "next generation" batteries it hopes to roll out from 2026 and technologies aimed at improving the driving range of its battery-operated vehicles. The company also announced plans to further automate its production assembly, moving away from the traditional conveyer belt system.
Toyota shares closed up 6.3% at 2,310 Japanese yen ($16.48) per share in robust volumes — their highest close since Feb. 9, 2022. Their record closing high at 2,390 Japanese yen per share was recorded Jan. 9, 2022. On Wednesday, Toyota shares outperformed the 1.5% gain on the Nikkei and 1.3% rise for the Topix benchmarks in Tokyo. The rally on Wednesday added to sizeable gains seen on Tuesday.
A small number of overseas institutional investors had agitated against the reappointment of Toyoda — a grandson of the founder of Toyota Motors — as chairman, taking issue with the independence of the company's board, given that he was the Toyota's chief executive until April 1 this year.
Some investors have also criticized the company's strategy of focusing on multiple fronts across hybrid, gasoline and electric vehicles has hurt its competitiveness. Toyota argues that this helps to cater to the diverse needs of customers in different regions, which they anticipate will differ further in future — pledging to "accelerate localization" in plans they unveiled on Tuesday.
Toyota has a goal of achieving sales of 1.5 million all-electric vehicles per year by 2026, and selling 3.5 million all-electric vehicles annually by 2030.
The unprecedented challenges by Toyota's shareholders this year come as Japanese companies are coming under increasing pressure to better engage its shareholders in improving capital efficiency and overall profitability.