The world's most successful vendor of
electric vehicle technology, albeit in the form of mild hybrids,
Toyota is going against the current on both of these trends, though.
In a new
Bloomberg report aired concurrent with the Frankfurt Auto Show,
it is revealed that Toyota extensively tested lithium-ion batteries
as a potential replacement for the nickel-metal hydride batteries in
its Prius and other mild hybrids.
What it found was that while
the batteries were extremely efficient and didn't raise serious
reliability or safety concerns, they were overly expensive for the
gains they provided. For that reason, Toyota reportedly
concluded that the market wasn't ready for lithium and has decided to
primarily continue with its nickel-based batteries for most of its
Toyota also concluded that electric vehicles were
too expensive to succeed in the current market. Toyota
Executive Vice President Takeshi Uchiyamada stated at a Frankfurt
Auto Show press conference, "Electric vehicles of today are less
costly than in 1990s, but if you compare them with the other vehicles
out there they are still too expensive. Unless there is a very
big breakthrough in battery costs I don't think electric vehicles can
take a large market share."
Toyota indicated that it will
likely stay out of the electric vehicle market for close to a decade,
the time it believes it will take for EVs to become profitable and
affordable enough for the masses.
So is Toyota right?
It's hard to say. Toyota's demonstration of business acumen
over the last several years is hard to argue, given its ability to
produce the first profitable
mass-production hybrid, the Prius, which leads worldwide hybrid
sales to date. Furthermore, there are a handful of competitors,
such as Germany's Audi, whose management are split
on the viability of electric vehicles (Audi's North American
president recently called buyers
of the Chevy Volt EV "idiots").
other hand, the vast majority of the industry is shifting towards all
electrics, and if Toyota counts on its competitors to lower
production costs, it may find itself in a foreign hole when it
finally decides to enter the market. While some of the German
automakers are pushing for clean diesel as a supplement or
alternative to hybrids, Toyota is pushing
hydrogen as a long term solution, a technology that faces
significant production, transport, and storage obstacles -- all of
which raise the price. Toyota may release a fuel cell
(hydrogen) car by 2015, according to recent reports.
So for now Toyota is opting for one of
the least expensive and most proven solutions (mild hybrids), while
its mid-to-long term efforts focus on what is currently the most
expensive and least proven solution of them all -- hydrogen.