Toyota Motor Corp. has revised its sales expectations for electric vehicles (EVs) this fiscal year.

Initially, the company predicted sales of 202,000 units but has now lowered the forecast to 123,000 units. This is a significant decrease of 39 percent. The revised forecast was part of Toyota’s Q2 2024 financial report.

As Toyota slashes its EV sales projection, it’s relying on its internal combustion and hybrid models to achieve record profits.

Previously, the company anticipated an operating profit of 3 trillion yen ($20.1 billion). In the latest financial report, that estimate has increased to 4.5 trillion yen ($30.15 billion).

Toyota aims to sell 3.6 million traditional hybrid vehicles globally by the end of the fiscal year, up from the previous projection of 3.5 million. Moreover, the company predicts that its total electrified vehicle sales, including EVs, hybrids, plug-in hybrids, and hydrogen fuel cell vehicles, will reach 3.9 million.

According to InsideEVs, the 3.9 million figure is a 42 percent increase compared to the previous fiscal year. It’s expected that electrified vehicles will account for approximately 37 percent of Toyota’s overall sales volume.

The current fiscal year concludes on March 31, 2024.

During the last fiscal quarter, Toyota achieved an impressive double-digit operating profit margin of 12.6 percent worldwide. This was more than double the margin from the previous year, which stood at 6.1 percent.

Currently, Toyota’s EV lineup includes only a few models such as the Toyota bZ4X and Lexus RZ. However, the company has plans to launch 10 new EVs by 2026, along with the introduction of solid-state batteries that are expected to offer a range of over 621 miles on a full charge. Solid-state batteries will be released in 2027.

At a press conference on November 1, Toyota chief financial officer Yoichi Miyazaki stated that the company’s hybrids have played a crucial role in establishing a “strong financial foundation” for the company’s future EVs.

Solid-state batteries are not the only technological innovation that could give Toyota an edge over its EV competitors.

Earlier this week, TechRadar reported that Toyota has built an EV prototype with manual transmission. The prototype is likely to appeal to the many drivers who feel that EVs are too digital and lack the character of internal combustion cars.