Development and Design

Environmental Aspects Development and Design Tatehito Ueda Environmental Product Design Assessment Committee Chairman Tatehito Ueda joined Toyota in 1974 and has gained experience in a wide range of areas, including development of engines and powertrains. After various assignments, including that of General Manager of the Power Train Management Engineering Div., he was appointed Managing Offi cer in 24. He took up the position of Chairman of the Environmental Product Design Assessment Committee in June 25. Development and design are important activities that greatly affect an automobile s environmental impact and include such factors as fuel effi ciency and exhaust emissions. Toyota s basic vision in terms of technology development is to minimize any negative impact, including in relation to the environment, while maximizing customer satisfaction in terms of a vehicle s usefulness, riding comfort, and the driving enjoyment it offers. In order to help Toyota realize this vision, its engineers are exploring every angle in their efforts to overcome various issues by developing environmental technologies and technical innovations. The results of the actions taken in FY25 are summarized below. 1) Achieved the 21 Fuel Effi ciency Standards in all vehicle weight categories 2) The percentage of total production that meets the Ultra Low- Emission Vehicle level reached 96%. 3) In March 26, the Lexus GS45h equipped with a newly developed dedicated hybrid system for rear-wheel drive passenger vehicles was launched, widening the market base for hybrid vehicles. 4) Worldwide sales of Toyota hybrid vehicles in FY25 were approximately 25, units, for a cumulative total exceeding 61, units. Toyota is committed to continuing to reduce environmental impact by increasing the use of such environmental technologies as hybrid and high-effi ciency engines. GS45h Product Environmental Management In FY25, Toyota continued to apply its technical area environmental management system (EMS), based on ISO 141 standards, to the development of new products. External audits to confi rm the status of EMS operation identifi ed one minor area of non-conformity any other requirements that the organization agrees to must be documented in manuals. The audits also identifi ed three areas to be monitored for further improvements, including more careful selection of managers responsible for internal audits and clarifi cation of the application scope of site manuals. On the whole, proper operation and maintenance were confi rmed. External Audits Items indicated by audits (minor area of non-conformity) Surveillance Items to be monitored 3 1 Improving Fuel Efficiency FY25 Goal Achieve the 21 Fuel Effi ciency Standards for all vehicle weight categories ahead of schedule in 25 Toyota has reduced CO2 emissions from its vehicles through fuel effi ciency improvements. In FY25, eight out of ten Toyota vehicle series that were new or underwent complete redesign cleared the 21 Fuel Effi ciency Standards. In the heaviest weight category, the Land Cruiser s fuel effi ciency was improved when it underwent a minor redesign, with the result that Toyota achieved the 21 Fuel Effi ciency Standards in all vehicle weight categories. The number of gasoline-powered passenger vehicles meeting the 21 Fuel Effi ciency Standards reached 87% of total production. 24 Sustainability Report 26

Increasing the Number of Vehicles with Fuel Efficient Engines Toyota developed a new 3.5-liter engine 2GR-FSE that uses a new fuel injection system D-4S, resulting in improved fuel effi ciency. The D-4S system optimally controls both in-cylinder direct injection and port injection. The in-cylinder direct injector uses a high-pressure, doubleslit nozzle injector to inject highly atomized fuel into the combustion chamber from two injection openings. This system stabilizes combustion by achieving a uniform mixture of intake air and fuel, thereby improving fuel effi ciency. (Km/l) 2 15 1 5 The new fuel injection system that features both direct injection and port injection Fuel Effi ciency Comparison between Selected Old and New Models New model Old model Belta Ractis bb RAV4 Estima Camry GS (Nov. 5) (Oct. 5) (Dec. 5) (Nov. 5) (Jan. 6) (Jan. 6) (Aug. 5) Actual Fuel Effi ciency of Toyota Vehicles in FY25 and 21 Fuel Effi ciency Standards (Km/l) 35 3 25 2 15 1 5 828-1,16-1,266-1,516-1,766 - Average fuel efficiency of Toyota vehicles in FY25 21 Fuel Efficiency Standards Best fuel efficiency among Toyota vehicles in each category 2,16-2,266 - (Weight category: kg) Introduction of High-efficiency Transmission To increase the effi ciency of its power-transmission systems, Toyota installed Super CVT-i (Continuously Variable Transmission-intelligent), that uses a wide gear-ratio range and a torque converter that can lock up even at low speeds, and improves fuel effi ciency by working effectively with the engine. When the vehicle is stopped with the transmission in Drive, neutral control is used (that is, the clutch is partially released) to reduce the engine load, thereby improving fuel effi ciency. The 6-speed Super ECT reduces the total gear ratio of the sixth gear (thereby increasing the gear ratio) to improve fuel effi ciency at high speeds. By reducing both the size and weight of various components, Toyota has achieved a 6-speed automatic transmission unit that is among the world s lightest. Additionally, downshift control during deceleration maximizes the fuel-cut range, further improving fuel effi ciency. Vehicles using Super CVT-I Vehicles using 6-speed Super ECT Ractis, RAV4, Belta and Estima Lexus GS, Lexus IS, Lexus SC and Estima Ractis Initiatives for Reducing Air Resistance Estima Toyota has reduced the overall air resistance of the vehicle body by using fl ush surfaces, reducing the difference in surface height between the windows and the body, using a rear spoiler, and making the fl oor panels fl atter through the use of various types of air fl ow control parts. Toyota has achieved coeffi cient of drag (Cd) values of.28 for the GS and IS,.29 for the Belta, and.31 for the Ractis. Vision and Structures Environmental Aspects Social Aspects Economic Aspects Special Story Models that Meet the 21 Fuel Effi ciency Standards among FY25 New Models and those that Underwent Complete Redesign (Passenger Vehicles) Weight category (vehicle weight: kg) Fuel effi ciency standard (km/l) FY25 average fuel effi ciency (km/l) Qualifying vehicle series of FY25 new models and those that underwent complete redesign 828-1,15 17.9 2.2 Belta 1,16-1,265 16. 17. Ractis,* Belta, bb* 1,266-1,515 13. 14.1 RAV4 1,516-1,765 1.5 11.8 RAV4, Estima, Camry,* IS25 1,766-2,15 8.9 9.8 Estima, GS Hybrid 2,16-2,265 7.8 9.9 2,266-6.4 6.5 *Some vehicles of the qualifying vehicle series may not meet the standards depending on individual models and specifi cations Note 1: indicates a category that has achieved the 21 Fuel Efficiency Standards Note 2: Vehicles that achieved the efficiency standards before FY24 are not included Note 3: All fuel effi ciency values are based on the Ministry of Land, Infrastructure and Transport s 1-15 Japanese test cycle Engine undercover Front floorcover Fairing in front of the front wheel Airflow control parts in front of the differential gear Differential gear support cover Rear floorcover Fairing in front of the rear wheel Lexus IS: Use of airfl ow control parts for the underbody Areas where airflow control parts are used Sustainability Report 26 25

Environmental Aspects Development and Design Reducing Exhaust Emissions FY25 Goal Set voluntary standards in response to the Exhaust Emissions Standards specifi ed in the Safety Regulations for Road Vehicles, the Approval System for Low-Emission Vehicles and new long-term regulations, and for vehicles in the eight Tokyo area municipalities Promotion of Widespread Adoption of Low-Emission Vehicles In FY25, Toyota increased the number of vehicle series that meet the 25 Exhaust Emissions Standards in the Ministry of Land, Infrastructure and Transport s Approval System for Low- Emission Vehicles. As a result, the combined total number of low-emission vehicle series including those that meet the 2 Exhaust Emissions Standards reached 99.7% of total production. The number of vehicle series that achieved an exhaust emission level the 25 Exhaust Emissions Standards (Super Ultra-Low Emission Vehicle level) reached 63.7% of total production, up by 4.2 percentage points compared to the previous year. The number of vehicle series that meet or surpass the Ultra Low-Emission Vehicle level and also meet the 2 and 25 Exhaust Emissions Standards reached 96.3% of total production in FY25, increasing by 5.5 percentage points from FY24. In FY25, among Toyota s gasoline-powered passenger vehicles, 39 models were approved as achieving a level the 25 Exhaust Emissions Standards and 5 models as achieving a level 5% lower than the 25 Exhaust Emissions Standards. The number of vehicle series that meet or surpass the Ultra Low-Emission Vehicle level and also meet the 21 Fuel Effi ciency Standards reached 84.5% of total production, an increase of 3 percentage points over FY24. Low-Emission Vehicles as a Percentage of Total Production (%) 1 25% lower than standard levels for 2 8 5% lower than standard levels for 2 6 standard levels for 2 4 5% lower than standard levels for 25 2 standard levels for 25 1 2 3 4 5 (FY) Percentage of Total Production that Met the Approval System for Low- Emission Vehicles based on the 2 Exhaust Emissions Standards in FY25 ( ) No. of models Category Reduction level Percentage of total production Conventional Low-Emission Vehicles 25% lower than standard levels for 2 3.4% (34) Percentage of Total Production that Met the Approval System for Low- Emission Vehicles based on the 25 Exhaust Emissions Standards in FY25 ( ) No. of models Category Reduction level Percentage of total production New U-LEV SU-LEV 5% lower than standard levels for 25 standard levels for 25 32.6% (11) 63.7% (69) Responses to the Approval System for Low-Emission Vehicles In response to the Low-Pollution Vehicle Designation System, in FY25 Toyota submitted its vehicles to the low-pollution vehicle designation system administered by eight Tokyo area municipalities, and received certifi cation for an additional 39 of its models, reaching a cumulative total of 562 models. Vehicles that Met the Approval System for Low-Emission Vehicles in FY25 (25 Exhaust Emissions Standards) Percentage of Total Production that Meet Both the 21 Fuel Effi ciency Standards and the Low-Emission Vehicle Level (Meet or surpass the Ultra Low-Emission Vehicle level) Percentage of total production Category FY24 FY25 21 Fuel Effi ciency Standards Low-Emission Vehicle level Ultra Low-Emission Vehicles New SU-LEV (Super Ultra-Low Emission U-LEV (Ultra-Low Emission Vehicle) Vehicle) Vehicle series No. of models No. of models Alphard 2 Ist 1 Hilux Surf 1 Land Cruiser Prado 2 GS 3 IS 3 SC 1 Noah, Voxy 2 Ipsum 2 Sienta 1 Wish 3 Ractis 2 1 Crown 1 RAV4 2 Belta 2 1 Isis 4 bb 3 Estima 4 Camry 2 GS Hybrid 1 Total 39 5 Exhaust Emissions Performance Low-Emission Vehicle Approval System (g/km) 5% lower than FY25 standards FY25 standards (.112).1 Nitrogen Oxides (NOx) (.84) (.56).5 (.28).25.13 25 Exhaust Emissions Standards 2 Exhaust Emissions Standards 25% lower than standard levels for 2 5% lower than standard levels for 2 standard levels for 2.13.25.5.1 (.27) (.54) (.81) (.18) Non Methane Hydro Carbon (NMHC) (g/km) Note: The values in the parentheses above have been converted, assuming test cycles specified in the 25 Exhaust Emissions Standards.1%.% New U-LEV 59.6% 25.6% SU-LEV 21.7% 58.9% 26 Sustainability Report 26

Responses to the Green Taxation System In FY25, eight out of ten vehicle series that were new or underwent complete redesign (IS, Ractis, RAV4, Belta, bb, Estima, Camry and GS Hybrid) met the Japanese government s Green Taxation System standards. The number of gasoline-powered passenger vehicle series that qualifi ed under the Green Taxation System, including vehicle series that underwent minor redesign, increased to 4 series in FY25. Furthermore, 14 models in a total of nine vehicle series the Prius, Alphard, Estima, Crown, Crown Sedan, Dyna/ Toyoace, Harrier, Kluger and GS Hybrid are eligible for the FY25 subsidy program for the purchase of electric or hybrid vehicles. Belta RAV4 Reducing External Automobile Noise bb Camry Details of Special Measures within the Green Taxation System A reduction of approximately 25% in automobile tax The automobile acquisition tax is reduced by 1, yen for an automobile for private use, and by 6, yen for an automobile for commercial use. Isis Alphard Alphard Hybrid ist Ipsum WISH Voxy Estima Hybrid Caldina Corolla Corolla Fielder Kluger Sienta Noah Hiace (Wagon) Harrier Fun Cargo Platz Probox A reduction of approximately 25% in automobile tax The automobile acquisition tax is reduced by 1, yen for an automobile for private use, and by 6, yen for an automobile for commercial use. Applicable vehicle series bb IS RAV4 Allion ist WISH Estima Camry Celsior Century Passo Harrier Premio A reduction of approximately 5% in automobile tax The automobile acquisition tax is reduced by 15, yen for an automobile for private use, and by 9, yen for an automobile for commercial use. GS Hybrid IS RAV4 Isis Alphard Allex ist Ipsum WISH Vitz Voxy Estima Camry Corolla Corolla Fielder Corolla Runx Crown Kluger Hybrid Sienta Noah Passo Harrier Harrier Hybrid Prius Belta Mark X Ractis Note: Not necessarily applicable to all vehicles due to differences in models or specifications. Applicable vehicle series are as of the end of March 26. http://www.mlit.go.jp/jidosha/green/green_16.htm (Japanese only) Noise Reduction Measures in the Land Cruiser Prado Hood silencer Dash silencer Vision and Structures Environmental Aspects Social Aspects Economic Aspects Special Story FY25 Goal Make all vehicles compliant with Toyota s voluntary standards on external automobile noise, set in response to permissible levels specifi ed in Article 4 of the Safety Regulations for Road Vehicles Intake resonator High-rigidity cylinder block High-rigidity aluminum alloy oil pan Engine cover (with sound-absorbent material) Continual Efforts to Comply with the Latest Standards Engine undercover (with sound-absorbent material) Main muffler capacity increase Main muffler with modified internal structure In FY25, Toyota continued to apply the latest standards to its new models and models that underwent complete redesign. Because passenger vehicles for off-road use have a large engine displacement, Toyota took various measures to reduce external automobile noise, including reinforcing engine blocks, using engine undercovers with a sound-absorbent material, and utilizing sound-absorbent materials in the engine rooms. Additionally, Toyota incorporated various measures to reduce internal exhaust noise, including using an intake resonator to reduce intake noise, increasing the capacity of the main muffl er, and modifying its structure. Sustainability Report 26 27

Environmental Aspects Development and Design Development of Clean-energy Vehicles Launching of the Lexus GS Hybrid In March 26, Toyota launched the Lexus GS45h equipped with a newly developed dedicated hybrid system for rearwheel drive passenger vehicles. This new hybrid system was developed around the concept of the Hybrid Synergy Drive, which represents a sophisticated fusion of superior driving performance, high fuel effi ciency, low emissions, and quiet operation. Because its hybrid transmission and power control unit are both smaller, lighter, and more effi cient, the new hybrid system can be used in rear-wheel drive passenger vehicles. FCHV-BUS Begins Trial Operation in Area around the Central Japan International Airport As part of the Fuel Cell Bus Practical Application Promotion Project of the Ministry of Land Infrastructure and Transport and with the cooperation of Chitanoriai Co., Ltd., Toyota began trial operation of the FCHV-BUS in the area surrounding the Central Japan International Airport (Centrair) in March 26. The plan is to expand operation routes in the area to coincide with the installation of a hydrogen fueling station near the airport. TOYOTA FCHV at the Central Japan International Airport (Centrair) Toyota s Improved FCHV Receives Vehicle Type Certification The improved TOYOTA FCHV, Toyota s fuel cell hybrid passenger vehicle, became the fi rst fuel cell vehicle in Japan to acquire vehicle type certifi cation under the Road Vehicles Act, as amended and enacted in March 25 by Japan's Ministry of Land, Infrastructure and Transport. In July, the vehicle was made available for lease and leasing began in October in the Osaka area. As of the end of March 26, 11 units were being leased in Tokyo, Aichi and Osaka, in addition to the two leased in the U.S., with the number expected to grow in the future. Toyota and Fuji Heavy Industries Reach Agreement on Hybrid Vehicle Development In March 26, Toyota and Fuji Heavy Industries Ltd. (FHI) agreed to consider the development of an FHI hybrid vehicle based on the Toyota Hybrid System. Toward the early realization of an FHI hybrid vehicle the two companies agreed to create a detailed framework, including the provision of Toyota hybrid technology, personnel exchanges and other issues. FHI President & CEO Kyoji Takenaka (currently Director and Senior Corporate Advisor), left, with TMC President Katsuaki Watanabe Increasing Popularity of Clean-energy Vehicles In FY25, Toyota sold 57,964 clean-energy vehicles in Japan, which accounted for 3.4% of all Toyota vehicles sold in the country. Since the launch of the fi rst generation Prius in December 1997, a cumulative total of more than 61, hybrid vehicles have been sold worldwide as of the end of March 26. Cumulative Number of Hybrid Toyota Vehicles Sold Worldwide (Number of Vehicles) 7, 613,296 6, 5, 4, 3, 2, 1, 97 98 99 1 2 3 4 5 6 (Year) (March end) Number of Toyota s Clean-energy Vehicles Sold in Japan FY21 FY22 FY23 FY24 FY25 Electric vehicles 56 23 7 Hybrid vehicles 23,373 15,39 42,21 64,877 57,756 CNG vehicles 187 162 222 277 28 Total 23,616 15,575 42,25 65,154 57,964 Percentage relative to all Toyota vehicles sold 1.4%.9% 2.4% 3.7% 3.4% Increased Use of Low-Pollution Vehicles As part of its efforts to help reduce global warming and improve the atmospheric environment, Toyota promoted increased use of low-pollution vehicles for its company fl eet. Toyota identifi ed those vehicles satisfying the Green Purchasing Law (clean-energy vehicles and vehicles that achieve an exhaust emission level 75% or lower than the 2 Exhaust Emissions Standards and meet the 21 Fuel Effi ciency Standards) as low-pollution vehicles and began introducing them into the company fl eet. In FY25, 125 new vehicles were added and the percentage of low-pollution vehicles reached 64% of the total number of passenger vehicles (65 vehicles) owned by Toyota. Toyota is aiming to reach 1% conversion in FY27. Development Team Stepping into Uncharted Territory The development of the fi rst rear-wheel drive hybrid vehicle faced a mountain of obstacles, including the need to reduce battery size, improve the cooling performance of the motor, realize quiet operation, and achieve optimal placement of various major components. In order to achieve our goals under opposing requirements, we argued a lot and had to work really hard to fi nd solutions. Everyone involved in the project has a keen realization that we are taking the hybrid concept into totally uncharted territory, says one of the development team members. Lexus GS45h development team 28 Sustainability Report 26

Reduction of VOC Inside the Cabin Toyota has reviewed the materials, adhesives and processing methods used for interior parts to limit the amount of volatile organic compounds (VOCs) generated, thus improving the air quality inside the cabin. Interior VOC levels have been reduced in nine vehicle series, namely the GS, IS, Ractis, RAV4, Belta, bb, Estima, Camry, and GS Hybrid. Application of Eco-VAS to All New Models In FY25, to further promote the use of environmentallyconsiderate designs, Toyota applied Eco-VAS, a comprehensive environmental impact assessment system that allows the systematic assessment of the impact a vehicle will have on the environment throughout the entire vehicle development process and during production, use and disposal, to all ten vehicle series that were new or underwent complete redesign (GS, SC, IS, Ractis, RAV4, Belta, bb, Estima, Camry, and GS Hybrid). Comprehensive environmental performance was enhanced and the results published in product catalogs. LCA In FY25, Toyota applied LCA (Life Cycle Assessment) to ten vehicle series that were new or underwent complete redesign. LCA is an evaluation of environmental impact over the total life span of a product, from the materials manufacturing stage, through the parts and body manufacturing stages, to the use, maintenance and disposal stages. LCA enables Toyota to assess the total volume of CO2 and other air-polluting substances released throughout the entire lifecycle of its vehicles. Implementation of LCA for the Lexus GS Series By combining the 3.5-liter D-4S engine with a high-performance motor, the GS Hybrid achieves a driving performance equivalent to that of a vehicle with a 4.5-liter engine, with a high fuel effi ciency of 14.2km/l (in the 1-15 Japanese test cycle), equivalent to that of a vehicle with a 2.-liter engine. The GS Hybrid has achieved a fuel effi ciency level that is at least 2% higher than the 21 Fuel Effi ciency Standards and an exhaust emission level that is the 25 Exhaust Emissions Standards. The GS has achieved its high fuel effi ciency level through the use of the D-4S engine and a more effi cient powertrain that uses a 6-speed automatic transmission, as well as a reduction in aerodynamic resistance. The GS also achieves cleaner exhaust emissions by using VVT-i and an air-fuel ratio compensation system. By using two stages of three-way catalytic converters to thoroughly clean the exhaust emissions, Toyota has signifi cantly reduced air pollutants in the exhaust emissions from vehicle start-up through the acceleration stage. As a result, it has been confi rmed that the new GS emits 11% less CO2, 19% less NOx, and 27% less NMHC compared to other gasolinepowered vehicles in the same class, while the GS Hybrid emits 29% less CO2, 3% less NOx, and 21% less NMHC. GS45h 1.8.6.4.2 Toyota Environment Forum Held to Promote Sustainable Mobility In June 26, Toyota held the Toyota Environmental Forum (Powertrain Technology Information Gathering Conference). At the Forum, Toyota reported on the status of its efforts to develop environmental technologies and its plan for creating eco-cars, from the following perspectives: (1) improving fuel effi ciency to reduce CO2 emissions, (2) cleaning exhaust emissions, and (3) addressing the issue of diversifying energy sources. With regard to the fi rst two items, efforts already began with the V6 engine developed in 23 and Toyota plans to completely renovate its engines and transmissions by 21. Toyota announced that it plans to install a new 1.8-liter gasoline engine with a continuously variable transmission in new models scheduled to be launched in the autumn of 26. Toyota also plans to double the number of its hybrid models by the early part of the 21s, and is also conducting research and development on plug-in hybrid cars.* As for item (3), Toyota has already developed a technology that will enable all of its gasoline-powered engines worldwide to use gasoline with a 1% ethanol content. Toyota also announced its plans for a vehicle that can run on 1% ethanol (Flex Fuel Vehicle (FFV)), which will be introduced in the spring of 27 in Brazil where bioethanol is widely available. *Plug-in hybrid car: Hybrid car that can be charged by an external electricity source NOx NMHC PM SOx Note 1: Assumes a lifetime travel distance of 1, km (1 years) and calculations based on the 1-15 Japanese test cycle Note 2: Because Toyota uses LCA to confirm relative environmental benefits, the graph shows assessment results as indexes. Additionally, since the CO2 value is based on tonnage while other values are based on kilograms, they are indexed separately. CO2 GS45h with hybrid system 1, 8 6 4 2 Disposal Maintenance Driving Vehicle manufacturing Material manufacturing A: 22 gasoline-powered vehicles in the same class Average of Toyota vehicles B: GS (gasoline-powered) C: GS Hybrid PM: Particulate Matter NMHC: Non Methane Hydrocarbons Vision and Structures Environmental Aspects Social Aspects Economic Aspects Special Story Sustainability Report 26 29