Toyota and Nissan choose different green-car paths
Willie Grace | 6/25/2014, 3:56 p.m. | Updated on 6/25/2014, 3:56 p.m.
Within the span of a month, Toyota Motor Corp. and Nissan Motor Corp. have doubled down on starkly divergent strategies for hybrid and electric vehicles.
While other global automakers hedge their bets on alternative powertrain technologies, Nissan and Toyota are placing risky wagers that each knows exactly which powertrain will dominate among next-generation green vehicles.
Nissan aims to be the global leader in EVs. Toyota wants to expand its lead as the world's top maker of gasoline-electric hybrids.
On June 9, Nissan released the second of four promised EVs, its e-NV200 battery-powered van.
Just weeks earlier, Toyota pulled the plug on its own EV program by ending a two-year deal to build electric Toyota RAV4 crossovers with Tesla Motors Inc. When the last RAV-4 rolls off the line later this year, the world's largest automaker will no longer be producing electric cars.
No other major automakers are as zealous about their chosen path.
"When it comes to zero emissions, we're absolutely religious," Andy Palmer, Nissan's chief planning officer, said at the launch of the e-NV200, Nissan's second EV after the Leaf. "We'll be the absolute, No. 1 leader in zero emissions. No doubt. That's our positioning."
Publicly, both companies say they see a need for a range of alternative powertrains to meet different driving conditions. But their product plans clearly show where each is plowing the big bucks: Nissan into EVs, while Toyota shuns them for hybrids.
Each gambit is risky. EVs are still hobbled by high costs and range limitations. Hybrids, also still pricey, face tougher competition from improved internal-combustion engines.
In any case, volume for both will remain tiny into the foreseeable future. Hybrids and EVs combined will account for less than 7 percent of global output in 2020, IHS Automotive forecasts.
"The most important point is who wants to buy these," said Atsushi Ishii, senior manager for powertrain forecasting at IHS. "Our forecast may be lower than you'd expect."
Nissan is once bitten, twice shy about setting sales targets for EVs.
It is still eating crow over CEO Carlos Ghosn's pronouncement that the Renault-Nissan alliance would sell 1.5 million EVs by the fiscal year ending March 31, 2017. From the launch of the Leaf in December 2010 through April, the two automakers have sold just 155,682.
Palmer wouldn't give volume forecasts for the e-NV200. It goes on sale in Europe this month and in Japan in October; a North American launch is still under review.
"What's the point of putting a volume on it? Because basically all it does is set a point of reference," Palmer said at the van's unveiling. "People that doubt or dislike or don't have the technology" then use that point of reference "to demonstrate failure."
He noted that it took Toyota five years to exceed 100,000 in cumulative global hybrid sales, following the introduction of the Prius hybrid in 1997. The Leaf alone, with worldwide sales of 119,000 units so far, has outpaced the Prius rollout in a mere three and a half years.
"In the context of global nameplates, this is already not a niche," Palmer said of Nissan's battery-powered vehicles. At the same time, he derided the view that hybrids are a panacea for carbon dioxide emissions, noting that they still rely on fossil fuels.
"I don't believe that a panacea hybrid solution is the right solution. It's not. It doesn't work in Europe right now. It doesn't work in the United States right now," Palmer said. "Simply hooking up your carriage to the world of hybridization doesn't work. It doesn't solve humanity's problem because it still has an exhaust pipe. It's still emitting emissions."
After dabbling in EVs with Tesla, Toyota said last month it would end its R&D deal with Tesla to supply an all-electric RAV4. Toyota is convinced EVs are only a short-range, run-about solution, said Jim Lentz, CEO of Toyota's North America region.
"I would rather invest my dollars in fuel cell development than in another 2,500 EVs," he said.
That will end Toyota's foray into EVs. For now.
Its only other offering is the pint-sized eQ, a battery-driven car based on the Scion iQ three-seater. Commitment to that car always has been halfhearted.
In 2010, when Toyota announced the eQ, the company predicted it would be selling thousands. But in 2012, Toyota scaled back those ambitions, saying it would sell about 100 of the cars in the United States and Japan on a limited basis.
In the end, Toyota allocated 90 to lease programs on the West Coast and just one to Japan -- to the municipal government of Toyota City, where the carmaker is headquartered.
About 70 have been delivered with the remainder due for distribution in the coming months, Toyota says. After that, Toyota has no plans to make any more.
Fuel cell ZEV
Hydrogen fuel cell technology is Toyota's new emissions-free play. A fuel cell car expected next year will be its compliance car for California's zero-emissions mandate.
To be sure, standard hybrids are expected to keep their edge over both EVs and fuel cells for years. IHS predicts they will account for almost 6 percent of global output in 2020, up from 3 percent today. That compares with 1 percent for EVs in 2020 and next to nothing for fuel cells.
But traditional internal-combustion gasoline and diesel engines will continue to dominate, accounting for 93 percent of worldwide production in 2020, IHS says. But they will be much more efficient because half will be equipped with stop-start, cylinder deactivation and other advanced engine technologies, IHS predicts.
Nissan's Palmer said that, aside from electric drivetrains, his company is "agnostic" about emissions-reducing technology. Nissan and Infiniti will deploy hybrids, downsized turbochargers, stop-start systems, clean diesels and fuel cells, he said.
Still, he doesn't hedge on Nissan's commitment to EVs in the face of growing global air pollution. "Humanity cannot sustain this," Palmer said. "We need zero emissions."
"Toyota, Nissan green-car divide widens" was originally posted at Automotive News on 6/23/2014.
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