Japanese rivals seek car engine of the future

By Jonathan Soble in Tokyo
Published: July 16 2008 23:13

Japanese carmakers are lining up behind competing green technologies as they race to develop even lower emission successors to petrol-electric hybrid cars.
A string of recent launches and announcements has clarified the shape of the battle lines being drawn by Toyota – maker of the Prius hybrid and the reigning champion of environmentally friendly vehicles – and rivals such as Honda, Nissan and Mitsubishi Motors.

At stake is the chance to set standards for the next generation of green cars in the same way that Toyota has put its stamp on hybrids – an increasingly urgent goal as expensive oil and concerns about global warming stoke demand for alternatives to petrol.
Big carmakers are only just beginning to produce vehicles that do away with petrol altogether – mostly on an experimental basis, although some versions will be avail­able for sale as early as next year.
At the centre of the technology battle is a debate over two competing power sources: plug-in rechargeable batteries and fuel cells that generate electric power using hydrogen.
Honda’s chief executive Takeo Fukui – a leading proponent of fuel cells – has dismissed batteries as an insufficiently brawny “golf cart” technology.
Honda last month became the first carmaker to offer a hydrogen-powered car to paying customers, leasing its FCX Clarity – whose only exhaust pipe emission is water – to a handful of customers in California.
The company is expanding its range of hybrids but Mr Fukui says that it will be limited to smaller cars and that Honda has no plans to build a battery-only electric vehicle.
Its engineers believe even the latest lithium-ion batteries are subject to fundamental limits that make them suitable only for small cars that make journeys of less than 100km.
According to Mr Fukui, to power a mid-size Accord sedan to its current refuelling range of about 600km, “two thirds of the car would have to be a battery”.
On the other side of the divide, Nissan and Mitsubishi believe the scope for battery improvements is far greater, so all-electric cars will be commercially viable in the near future. Nissan plans to launch an electric car powered by a lithium-ion battery in Japan and the US in 2010. Mitsubishi will be even quicker to market, offering its MiEV ultra-compact in Japan next year.
According to Nissan, the batteries it is developing with NEC, the Japanese electronics group, will give its car a range of 160km and be 80 per cent rechargeable in 20 minutes. “We think a range of 300km or so could be possible in a few years,” Nissan says.
For battery advocates, hydrogen looks like an unnecessarily complex and expensive answer to the industry’s carbon problem.
Honda’s FCX Clarity costs Y100m ($950,000) a vehicle to produce, boosting the case made by critics. Honda admits it will take a decade to bring the cost down to a still pricey Y10m.
Standing above the debate so far has been Toyota, which is busy enjoying the benefits of the hybrid boom. Unsurprisingly for a cautious and cash-rich incumbent, it is covering all the bases in new technology – pushing battery improvements through its joint venture with Panasonic while also developing fuel cell prototypes.
Yet there are signs Toyota is leaning more towards batteries than fuel cells. Its chief executive, Katsuaki Watanabe, has said fuel cells are at least a decade away from becoming a viable technology.
The company is working on a plug-in version of the Prius that will depend more on the electric side of its power sources and has promised hybrid versions of all its cars by the 2020s.
Still, according to Koji Endo of Credit Suisse, Toyota has not committed itself just yet and remains in a position to be kingmaker in the next technology round.
“Toyota has enough money to hedge its bets and move into whichever technology starts to emerge as the winner,” he says.
Copyright The Financial Times Limited 2008