Toyota Far Surpasses GM When It Comes to EV

Toyota (NYSE:TM) has been working on the electrification of mass produced cars through the use of hybrid power trains and the in-house development and manufacturing of batteries for at least fifteen years. Toyota adopted the nickel-metal hydride [NiMH] battery and the hybrid power train using it in the late 1990s after the NiMH battery had been in development for a decade by its original inventor, Energy Conversion Devices, Inc., and by nearly all of the Japanese battery makers, such as Panasonic (PC) and Sanyo (SANYY.PK).

Toyota entered into a joint venture with Panasonic to manufacture and continue the development of the NiMH battery as it, Toyota, began to manufacture the Prius NiMH using hybrid and let the market beta test the power train. The Prius was so successful that Toyota bought out Panasonic's interest in the JV and took it in-house to preserve competitive advantage. GM rejected the hybrid concept and watched as Toyota swept the field to become the "green' car maker.

Toyota, it is said, does not want to switch over to the untested lithium-ion battery or to convert the Prius to plug-in power, because it has a vested interest in NiMH batteries.

Toyota does not want to make the switch-over for the simple reason that NiMH battery hybrid power trains work well, are reliable, long lived, durable under extremes of weather, and can bring fuel efficiency to more than 50 miles per gallon while capable of 100 mph top speeds and ranges of 500 miles and more.

Toyota has rightly seen that the market for a golf-cart like Chevrolet Volt with a 40 mile range on a charge and costing as much as a third to a half more than a Prius is tiny and limited ultimately to those few with high discretionary incomes wanting to make a "green" statement.

Toyota estimates that the market for a plug-in hybrid with the characteristics of a Chevrolet Volt may be no more than a few thousand a year, a rate at which the car could never repay the investment made to develop and produce it.

Lithium-ion batteries are too expensive and their long term characteristics are unknown, so that Toyota foresees the high probability of a large degree of customer dissatisfaction as battery performance degrades from the original mediocre to unacceptable.

The NiMH battery, on the other hand, has proven to be durable, safe, long lived, and able to maintain acceptable performance characteristics for up to a decade.

The economics of lithium-ion batteries in plug-in hybrids are only marginally better than those of NiMH batteries in full hybrids. It would be as foolish for Toyota to give up the NiMH battery based Prius hybrid power train as it is for GM to continue to develop the Chevrolet Volt.

The test of time will soon take place. I suspect that Toyota by the end of the second decade of the twenty-first century will be a very large profitable maker of a range of passenger carrying vehicles with a variety of power trains and that GM will no longer be in business in 2020.

Comments

[Markdark:]

Thanks Jack.
You state the battery issue more clearly than anything I have read about it for the past year-and-a-half.
Despite the drubbing they have taken in the last year, my Toyota shares will be held..

May 21 06:47 AM

[Mad Hedge F...:]

They've been working on this for decades. Obama announced the adoption of California’s stringent CAFE standards nationally, which will force car makers to improve gas mileage to 39 mpg for cars and 30 mpg for trucks in six years. The move is expected to save 1.8 million barrels/day of crude by 2016, cutting imports by 10%. But it is expected to raise the cost of a new car by $1,300. Left unsaid among the smiles and platitudes is that fact that the Japanese have been preparing for this day for 20 years, and the Big Three, with nothing even remotely close on the drawing board, have been hung out to dry by the consumer. One man behind Obama stood especially tall. The new regulations put Toyota USA (TM) president Jim Lentz in the sweet spot, with the largest hybrid market share of any manufacturer. This month its third generation, $22,000, 50 mpg Prius is bringing new customers into the showrooms in droves, helping to boost MOM sales by 15%.

May 21 07:46 AM

[Douglas Hvi...:]

Take a look at MDIs Flow-Aire line. Due out soon, they avoid the battery issue for stored energy vehicles. Hope it works out well - they are taking a big chance on the technology. Search on ("zero pollution motors" AND MDI) and follow up for more data.

May 21 07:53 AM

[ECD Fan:]

Mr. Lifton,

You seem to be misinformed about the so-called advantages of NiMH propulsion batteries. See my analysis at ecdfan.blogspot.com/20...

The truth is, Toyota (as well as every other automaker, including Honda) is already moving to li-ion. www.greencarcongress.c...

NiMH is fine as a souped-up replacement of lead-acid batteries, but if we are talking about batteries for true plug-ins and EVs, it is simply impractical vs li-ion.

May 21 09:28 AM

[pftittl:]

As a Prius owner, I can tell you that once you go that road you never go back. What no one talks about is the inexpensive maintenance. Every 15K miles I take it in and it costs less than 100 dollars, and it seems like nothing is ever wrong. In San Francisco, taxi drivers put 300K miles on their Priuses before they were forced to retire them, and they still had the original battery packs. As the years go by and word gets out, the cars will sell themselves. My concern for the stock, however, is the impact on the company's dealerships with so little income from the repair shop. My mechanic who specializes in Priuses said he'd be broke if he had a shop dependent on repairing them. They're too well-engineered.

May 21 09:33 AM

[Wisdom vs. ...:]

ecd fan, everyone knows that at +$1,000/kWh Li does not work for transportation, period; unless you have info on an upcoming tech- breakthrough, you are wasting your time.

the word IS out on priuses. they do break, and when they break, they get TOWED; and, unless you live in a dense urban area, they get towed a long way. people in my neck of the woods (well, desert) drive priuses around town and keep them off the interstate. priuses still have all the moving parts, plus all those computers that have to integrate perfectly; they are more complicated, and in the long run HEVs will be less reliable, not more, it is simple math

May 21 10:57 AM

[John Petersen:]

Another great piece Jack, keep them coming.

May 21 12:09 PM

[ECD Fan:]

To Wisdom: Well, Tesla is saying $700/kWh. And they are not lying (it is easy to check prices for quality 18650 cells in bulk). Yes, EVs, plug-ins, and hybrids with current technology and gas prices in the US are too costly and do not pay off, overall. But the question is: if one has to choose between li-ion and NiMH for propulsion, which is the better choice? Mr. Lifton seems to imply that NiMH is the better choice. He appears to be mistaken, given the facts.

May 21 12:30 PM

[ClarenceBeeks:]

I own a ZAP Xebra 4 door all electric sedan made in China for ZAP in Santa Rosa, Ca. Although it uses prehistoric battery technology with 6 lead acid batteries, it achieves 20-28 miles per charge. I drive it to work every day which is roughly a 12 mile round trip and the monthly electrical bill amounts to approx $ 20. that sure beats the $300-$400 a month in gas I paid last summer when gas got up to over $ 4/ gallon. This car is not a freeway vehicle since it gets up to 40 mph, but it also doesnt require alot of maintenance, is not polluting the environment and is cheap to operate. I praise all auto company's efforts to develop electric techology over pollution causing internal combustion engines. Hallelujah! For more info on Zap, go to: ZAP.com (they make scooters pickups and vans too!)

May 21 12:36 PM

[ClarenceBeeks:]

Sounds like ZAP is inexpensive and practical for short commuters...good article.

May 21 12:40 PM

[33Nick:]

It goes back to the same point many people are making, there are many types of batteries for EV, depending on your needs.

Although, we would like to point that Toyota is no angel when it comes to EVs, having quoted some of its top managers saying when they built the RAV4 EV, they built too well and couldn't make money off of them. Indeed, there was very little maintenance cost. What did Toyota do, instead of "developing" this great technology? It simply yanked out the vehicles, despite a very strong following.

In the end, we believe lead-acid and their derivatives are great for city dwellers and heavy equipment, NiMH is a good compromise for performance/range/price and when it comes to pure performance, lithium tops it, albeit at a price premium.

The Electricnick.com team.

May 21 02:27 PM

[Jack Lifton:]

33Nick,

I agree with your conclusions, and I would like to add that I never said nor would I ever say that a Fortune 1000 global corporation is an angel. My point is that they were and remain better at planning for the long term than GM, or, for that matter, most of their competitors.

There is no overall win, place, or show rating for the three storage battery systems you mention unless you also pick a market segment, as you have done. The problem with the shallow reporting of the mainstream media is that it always looks upon the electrification of private passenger carrying motor vehicles as a winner takes all competition. This isn't only wrong its just plain stupid.

May 21 03:15 PM

[henarl:]

I, like pftittl, am the happy owner of a Toyota Prius (2008 model). I agree with the author that Toyota has nothing to worry about from the Chevy Volt. The new 5 door Honda Insight will give them competition tho. I drove Cadillacs before buying the Prius and I think I now have a much greater value for my dollar. Now they need to come out with a U.S. available plug in model.

May 21 03:57 PM

[Grampa Jim:]

So, how long 'till we get a Prius convertible?

May 21 04:27 PM

[Jack Lifton:]

Grampa Jim,

You ask a very good question, and I think it deserves an answer, which i do not think you (or I) will like.

One of the key engineering issues with the design of a small car to maximize fuel efficiency is that its aerodynamic drag be minimized so as to avoid wasting fuel. The Prius, Insight, and Ford Fusion hybrids, as well as the Chevrolet Volt, are designed with this as a primary concern.

Even if the design were to include a retractable hardtop with all of the motors, energy required to operate them, and the dead space required to store the retracted top there would be the problem of what aerodynamics do we get with the top "down.?"

Unfortunately for you and for me and for our sympaticos the loss of fuel efficiency from the design limitations of a convertible is considered to be negative economically for the target market. For every carefree boy or girl who wants the wind to blow through their (where in my case there was once) hair there are literally hundreds of customers who want fuel efficiency more.

The stated reason from every car maker for no convertible EV is that the electric energy required to raise and lower the top is just too high to warrant the complexity of the design and the loss of overall perofrmance. The truer reason is that those who want a convertible do not add up to a large enough market segment to warrant the expense of the design and production.

A Camero convertible with its high price tag will bring you to the showroom to ooh and aah while you settle for the hardtop. This is the very definition of a halo car.

For your information it is no secret that with the initial limited production of the Chevrolet Volt it will be impossible for any dealer to "fairly" get more than one or two of them in the entire first year. GM is already telling its delaers: Use it as a halo car. Don't sell it. Just let customesr ooh and aah and put them into Malibus and Impalas.

If the Volt is a flop then you can expect to see a convertible model, because by then it will only be a halo car.

May 21 04:49 PM

[fireofenergy:]

After some casual googling, I have come to the conclusion that lithium ion is far superior in the way of charging and discharging efficiencies (given circuit protection), however (and this is a big "but"), they really are not as long lived, do not tolerate extremes and are more expensive. NiMH is still twice as light as lead acid and in my own experiments have actually been drained to 0 volts (Try that with other types). I connected the solar panel backwards on purpose and the battery pack still works (after modest charge) almost as if noth'n wrong happened that day!

Since lithium is so much more efficient (needed for renewable energy storage), we need them to become longer lasting and much cheaper than NiMH. This is supposedly what the national energy dude is up to!

May 21 04:53 PM

[Juan Carlos...:]

ECD Fan,

I fully endorse your two comments. I just wonder why Mr. Lifton decided not to respond.


On May 21 12:30 PM ECD Fan wrote:

> To Wisdom: Well, Tesla is saying $700/kWh. And they are not lying
> (it is easy to check prices for quality 18650 cells in bulk). Yes,
> EVs, plug-ins, and hybrids with current technology and gas prices
> in the US are too costly and do not pay off, overall. But the
> question is: if one has to choose between li-ion and NiMH for propulsion,
> which is the better choice? Mr. Lifton seems to imply that NiMH is
> the better choice. He appears to be mistaken, given the facts.<br/>

May 21 08:42 PM

[WayneS:]

US automakers build the vehicles that 99% of us want. There have been good american cars that get better than 30 mpg every year for the last 70 years. The few people that actually want vehicles with good mileage are, like you, prejudiced against US automakers so why would US automakers make vehicles people won't buy?
The only way the government can force higher mileage (without destroying the US economy) is to raise the cost of gasoline to at least $4/gal. This would also go a long way to curing the healthcare "crisis" 1700 people's lifes were saved and billions of dollars were saved with $4 gasoline..


On May 21 08:40 AM Freya wrote:

> Great Article.
>
> US automakers should have learned from the 70's, instead they reverted
> to "same old, same old".
>

May 22 11:47 AM

[harammph:]

HARAMMPH.

Or in your case "harroommph" should suffice.

The US automakers produced LEMONS by the Millions in the late 70's. Every lousy year, 1 million recall of this or that. That's what sent people away.

May 22 01:17 PM

[Grampa Jim:]

Jack:

Many thanks for your extensively detailed reply. I was afraid it would be something like that. So, now the Toyota Solara convertible is looking better and better, the all-gasoline power notwithstanding. By the time I buy to replace my Chrysler Sebring convertible, the mileage on the Solara should really be up there. By the way, I just saw the VW "tear-drop" single-seater, supposedly coming out next year for $600 in China and getting 100 mpg with top speed of 62 mph. Is this for real? Your comments would be most appreciated.


On May 21 04:49 PM Jack Lifton wrote:

> Grampa Jim,
>
> You ask a very good question, and I think it deserves an answer,
> which i do not think you (or I) will like.
>
> One of the key engineering issues with the design of a small car
> to maximize fuel efficiency is that its aerodynamic drag be minimized
> so as to avoid wasting fuel. The Prius, Insight, and Ford Fusion
> hybrids, as well as the Chevrolet Volt, are designed with this as
> a primary concern.
>
> Even if the design were to include a retractable hardtop with all
> of the motors, energy required to operate them, and the dead space
> required to store the retracted top there would be the problem of
> what aerodynamics do we get with the top "down.?"
>
> Unfortunately for you and for me and for our sympaticos the loss
> of fuel efficiency from the design limitations of a convertible is
> considered to be negative economically for the target market. For
> every carefree boy or girl who wants the wind to blow through their
> (where in my case there was once) hair there are literally hundreds
> of customers who want fuel efficiency more.
>
> The stated reason from every car maker for no convertible EV is that
> the electric energy required to raise and lower the top is just too
> high to warrant the complexity of the design and the loss of overall
> perofrmance. The truer reason is that those who want a convertible
> do not add up to a large enough market segment to warrant the expense
> of the design and production.
>
> A Camero convertible with its high price tag will bring you to the
> showroom to ooh and aah while you settle for the hardtop. This is
> the very definition of a halo car.
>
> For your information it is no secret that with the initial limited
> production of the Chevrolet Volt it will be impossible for any dealer
> to "fairly" get more than one or two of them in the entire first
> year. GM is already telling its delaers: Use it as a halo car. Don't
> sell it. Just let customesr ooh and aah and put them into Malibus
> and Impalas.
>
> If the Volt is a flop then you can expect to see a convertible model,
> because by then it will only be a halo car.

May 24 01:46 PM

[David Sven:]

First of all, the comment that the Volt get's 40 miles implies that it only gets 40 miles before needing to refuel. This is completely false. It gets 40 miles of pure electric range, and several hundred miles of range extra with the gas engine. This is something the Prius has no capability of doing.

Second, Lithium is vastly superior to NiMH in both energy and power densitys and specific energy and power. Yes the cost is higher, but is this not the very problem you are complaining about in the first place? Is it not been publicized over and over that the shortsightedness of auto companies are what killed them? Saying that the NiMH suffices is falling back into that path of shortsightedness. Economies of scale will reduce prices and lifetimes will be learned for Lithium, but only if we start to implement them now!

May 31 11:19 AM