Toyota to drop EV line, to concentrate on Hydrogen Fuel Cell cars (Prius, buy)

[OpenD]

In parallel statements, Tesla Motors has just announced they will stop selling Electric Vehicle (EV) batteries to Toyota when their contract expires at the end of this year, and Toyota has announced it will cease production of battery powered EVs to concentrate on Hydrogen Fuel Cell (HFC) technology to power their zero-emissions vehicles.

Until now, Toyota has been covering all bases in the emerging alternative-power automotive field by developing a hybrid gas/electric system (Prius), an all electric car (RAV4 Electric), and a hydrogen fuel cell car to be introduced next year.

Toyota, for a time, appeared to be hedging its bets. In a joint news conference with Tesla in 2010, Toyota’s chief executive, Akio Toyoda, said the market had not yet chosen the best low-emissions technology. He said the company was preparing for all options.

“When customers do give us their answer,” Mr. Toyoda said, “I want the company to be ready.”

http://www.nytimes.com/2014/05/13/bu...deal.html?_r=0

But I guess they changed their mind. Here's another take on the shift...

By the end of the year, Tesla’s contract to supply battery packs for the Toyota RAV4 EV will come to an end, and Tesla won’t seek its renewal. With battery production bottlenecking Tesla Model S sales, the one-time win for the electric automaker has likely turned into a liability…and nobody seems all that upset about the end of the program.

Certainly not Toyota, which only built the RAV4 EV to satisfy California’s zero-emissions vehicle policy, and has actively discouraged sales outside the Golden State. For Tesla, the contract was worth about $15 million in the first quarter of 2014, and about $100 million in total, which certainly isn’t chump change. But it’s a drop in the bucket compared to Tesla’s $25 billion stock valuation, and I don’t think Tesla’s coffers will miss it.

Gas 2 | Bridging the gap between green heads and gear heads.

Personally I think the EV vs HFC horse race will not be decided for years to come. Each technology has advantages and disadvantages that consumers will vote on with their dollars, and the eventual outcome is in no ways clear at the moment. That's what makes the Toyota announcement a bit curious to me. On the other hand, Toyota made their investment in Tesla, and entered into the battery deal back when Tesla was just a start-up with an unusual Roadster design. Now Tesla sales vastly exceed Toyota's EV sales, and are currently throttled back by available battery supply, so Toyota has burnt fingers and Tesla needs the batteries and both parties just want out of the deal. Voila!

[Dakster]

OpenD - So is this a good thing or a bad thing? I can't tell reading your post. And does this mean the end of the Pruis as we currently know it as well?

[OpenD]

It's neither good nor bad, it's just a thing.

I don't see this affecting Prius at all. They're just going ahead with two alternative systems rather than three.

[Dakster]

So no plug-in prius and obviously the EV Rav 4 is a goner.

Maybe your Tesla Model X will get here sooner and be affordable.

[OpenD]

Here's an interesting update on what had been reported earlier in the year, that Toyota was ending its agreement to have Tesla build the battery and powertrain for its electric RAV4 model, built primarily to satisfy Japan governmental regulations, once the contracted 2,500 were built. This was supposedly done because Toyota wanted to concentrate on its hydrogen fuel cell line.

But this article has a bit of a different take on it, that the announcement may have just been a temporary punt.

One detail that hadn't come out before is that Toyota pretty much has to build a hydrogen fueled car right now for the Japan domestic market, where a $20,000 government subsidy is expected to bring the consumer cost on Toyota's new Mirai down to about $50,000. And there's more...

Tesla Motors installed battery-electric powertrains in 2,500 Toyota RAV4s. That deal is over -- but is a bigger Toyota-Tesla tie-up in the works? Source: Toyota.

But there may be a much bigger project in the works, and Tesla CEO Elon Musk may have let the cat at least partially out of the bag on Monday.

Speaking to reporters at an event in Tokyo, Musk said he "would not be surprised" if a "significant deal with Toyota" to produce an electric vehicle "maybe on a much higher volume level" than the RAV4 project came into being "maybe two or three years from now," according to an Automotive News report .

Toyota had no comment in response to Musk's remarks on Monday, and it's possible that Musk is just betting that the batteries Tesla is planning to produce at its new "Gigafactory" will draw Toyota's interest.

But what if there's more to it? What if Toyota felt comfortable turning its own R&D efforts away from battery-electric cars -- because it knew that Tesla would have it covered if and when the market shifted in that direction?

In other words, what if Toyota's dismissal of battery-electric technology was at least partially a bluff?

Is Toyota's Hydrogen Car a Giant Bluff? - NASDAQ.com

[Dakster]

I am not a big Toyota fan, however, I don't see Toyota getting caught holding the bag on any new propulsion technology. If EVs are it, they will be there, if HFCs are it, they will be there too. If it's CNG or LNG, I bet they will be there as well.

The catch is what will each cost to own and operate per mile.

Tesla has already proved you can make a battery car fun to drive. Hydrogen powered cars have not done that yet. Neither has proven you can tow the 5th wheel/ travel trailer to the campground with them yet either. Yeah, Wal-Mart built that rig to show battery power has a potential spot in freight movement, but it isn't a total EV power train. (at least IIRC)

If EV, HFC, CNG, and LNG can all be filled at home... Home run in my book. I so enjoy using the Volt. I "refuel" at home everynight and I don't have to leave the garage to do it. Of course a nuclear car that needs refueling once every 100 years or so would be the ticket, provided you could afford to buy the think to begin with.