Toyota: Going Places Without Gas

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Toyota Motor Corp.’s (NYSE: TM) new hydrogen fuel cell vehicle will make its debut at November’s Tokyo motor show. The company plans to mass produce the car, a sedan, for sale in early 2015. Currently, only prototypes are available. Along with rolling out more cars, Toyota wants to slash the cost. A top spokesman for the company, speaking to  Automotive News, states that Toyota wants to cut costs in half by 2015 to roughly $51,000, then in half again by 2020.

Successful price drops mean a consumer sticker price in 2015 between $51,000-$100,000. Toyota has brought the price production down drastically from 2007′s budget breaking $1 million per fuel cell cost. But price isn’t the only hurdle the company has to jump to successfully pitch the sedan.

First, they’ll need to accurately explain a highly technical process to potential consumers: how their cars operate using a fuel cell. As Forbes reported back in June, Toyota has a serious leg up on the U.S. when it comes to fuel cell technology. It is an area the Obama administration, until June, had not largely explored. That changed when they agreed to test four Toyota cars that use the technology.

The cars, according to feuleconomy.gov, a website created by the U.S. Department of Energy, can help reduce the U.S.’s dependence on foreign oil. They also do not contribute environmentally damaging tailpipe emissions. Instead of being fueled by gasoline, the cars use hydrogen gas. Inside the cars is a fuel cell stack, which converts the car’s hydrogen gas, and oxygen in the air, into electricity to power the car.

However, the infrastructure to support hydrogen cars is essentially nonexistent in the U.S. The U.S. Department of Energy only lists a total of ten in the entire country, nine on the west coast, one on the east. If Toyota wants a strong U.S. market for the fuel cell, driving habits will need to change, and explanations of the technology will need to be widely available and easily digested.

Toyota may also confront issues with driver preference for how a car looks and feels. Autoweek tested the new car last week. Writing about the car’s design and drive, the reviewer said “It wasn’t sporty, but it was much more fun to drive than, say, a Prius, which is like driving a block of wood.” Part of the design, Automotive News reported, is predetermined by the fuel cell. A large front radiator, is necessary to help it safely cool. This affects aerodynamics and design. They quote Satoshi Ogiso, the managing officer for the company, explaining Toyota stylistically wanted the car to ”be something unique for early adopters.” It won’t be the car for everyone, but the developments mark progress in the fuel cell sector.

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