Newsday, 10 April 2005 - Toyota Motor Corp. is going all out on hybrids, and its gamble is part of one of the industry's highest- stakes poker games.
While other automakers are hedging their bets, fearing that stiff development costs and higher sticker prices of hybrids will limit the technology to a niche, Toyota stands to benefit handsomely if its rivals are wrong.
Toyota is the only automaker developing production hybrid powertrains for front- and rear-drive vehicles, for both cars and trucks, and for four-, six- and eight-cylinder engines.
"Eventually all of our vehicles" will be offered with a hybrid option, says Jim Press, chief operating officer of Toyota Motor Sales U.S.A. Inc.
Hybrids use an internal combustion engine and an electric motor to power the wheels. Toyota believes a large pool of consumers will want hybrids to boost fuel efficiency or performance. Hybrids also provide a technological halo for all Toyota vehicles.
And Toyota's heavy spending is creating patents - 650 and counting - that could provide an edge over competitors. As one indication of that, Ford Motor Co. licenses some of Toyota's technology for the Escape hybrid SUV.
Toyota sees even more advantages if fuel cell vehicles are a major commercial success. They will use a lot of hybrid technology, potentially creating decades of income from licensing deals. Fuel cells use hydrogen to create pollution-free power.
K.G. Duleep, managing director of transportation for Energy and Environmental Analysis Inc., in Arlington, Va., sees "a lot of carryover between hybrids and fuel cells in the electronics and motors. Toyota could have a real competitive advantage in developing fuel cells."
Even if fuel cells fail to become a significant alternative to the internal combustion engine, Toyota will be well-positioned in a proven alternative to save fuel: hybrids.
Other automakers are wary, unsure how many people will pay a premium for hybrid technology, estimated by analyst Duleep at $3,500 per vehicle. Some even have knocked Toyota by calling the Prius hybrid car a massive PR campaign to deflect attention from Toyota's big pickups and SUVs.
Honda Motor Co. and Ford are selling hybrids in the United States but are proceeding more deliberately. Nissan Motor Co. is licensing Toyota technology and plans an Altima hybrid in 2006. General Motors is planning full-sized hybrid-powertrain pickups and SUVs in 2007.
Many European automakers are concentrating on diesel technoloy.
Toyota doesn't have a stranglehold on hybrid technology.
Breakthroughs are possible with any emerging research effort. Ford and Honda are learning from their early work, and GM's December deal with DaimlerChrysler will accelerate its hybrid development. And Hyundai is working at its gleaming new South Korean research and development studio.
Eric Noble, president of the Car Lab consulting firm in Orange, Calif., sees Toyota as the "800-pound gorilla of hybrid technology."
The Prius' price tag is roughly the same as developing a drivetrain from scratch - with significantly more fiscal upside if hybrids take off. Toyota officials say their hybrids are breaking even, even at this early stage of development.
Toyota's push into hybrids is about much more than market share.
Toyota desires the intellectual property rights for the heart of the fuel cell propulsion system of the future, says Dave Hermance, executive engineer for environmental engineering.
Copyright 2005 Newsday, Inc.
While other automakers are hedging their bets, fearing that stiff development costs and higher sticker prices of hybrids will limit the technology to a niche, Toyota stands to benefit handsomely if its rivals are wrong.
Toyota is the only automaker developing production hybrid powertrains for front- and rear-drive vehicles, for both cars and trucks, and for four-, six- and eight-cylinder engines.
"Eventually all of our vehicles" will be offered with a hybrid option, says Jim Press, chief operating officer of Toyota Motor Sales U.S.A. Inc.
Hybrids use an internal combustion engine and an electric motor to power the wheels. Toyota believes a large pool of consumers will want hybrids to boost fuel efficiency or performance. Hybrids also provide a technological halo for all Toyota vehicles.
And Toyota's heavy spending is creating patents - 650 and counting - that could provide an edge over competitors. As one indication of that, Ford Motor Co. licenses some of Toyota's technology for the Escape hybrid SUV.
Toyota sees even more advantages if fuel cell vehicles are a major commercial success. They will use a lot of hybrid technology, potentially creating decades of income from licensing deals. Fuel cells use hydrogen to create pollution-free power.
K.G. Duleep, managing director of transportation for Energy and Environmental Analysis Inc., in Arlington, Va., sees "a lot of carryover between hybrids and fuel cells in the electronics and motors. Toyota could have a real competitive advantage in developing fuel cells."
Even if fuel cells fail to become a significant alternative to the internal combustion engine, Toyota will be well-positioned in a proven alternative to save fuel: hybrids.
Other automakers are wary, unsure how many people will pay a premium for hybrid technology, estimated by analyst Duleep at $3,500 per vehicle. Some even have knocked Toyota by calling the Prius hybrid car a massive PR campaign to deflect attention from Toyota's big pickups and SUVs.
Honda Motor Co. and Ford are selling hybrids in the United States but are proceeding more deliberately. Nissan Motor Co. is licensing Toyota technology and plans an Altima hybrid in 2006. General Motors is planning full-sized hybrid-powertrain pickups and SUVs in 2007.
Many European automakers are concentrating on diesel technoloy.
Toyota doesn't have a stranglehold on hybrid technology.
Breakthroughs are possible with any emerging research effort. Ford and Honda are learning from their early work, and GM's December deal with DaimlerChrysler will accelerate its hybrid development. And Hyundai is working at its gleaming new South Korean research and development studio.
Eric Noble, president of the Car Lab consulting firm in Orange, Calif., sees Toyota as the "800-pound gorilla of hybrid technology."
The Prius' price tag is roughly the same as developing a drivetrain from scratch - with significantly more fiscal upside if hybrids take off. Toyota officials say their hybrids are breaking even, even at this early stage of development.
Toyota's push into hybrids is about much more than market share.
Toyota desires the intellectual property rights for the heart of the fuel cell propulsion system of the future, says Dave Hermance, executive engineer for environmental engineering.
Copyright 2005 Newsday, Inc.
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