Toyota building its own Li-Ion battery factory for plug-in hybrids

[AMERICA 123]

Originally Posted by zete

It's immaterial how many factories you have if you can't get the raw materials. The raw materials will be key, and if there's a sudden surge in the cost of that everyone who uses Li-Ion is going to be affected, factory or no.

Same with rare earth magnets - yet another potential Chinese 'chock point'.

The good news with China is Japan Inc. can never quite have the relationship potential we do.

Regardless of how it goes for us, its going to ultimately be worse for them.

[AMERICA 123]

Originally Posted by HoosierRon

Unlike the Chinese factories making batteries for the rest of the world, Toyota's battery factories will not need to make a profit (and, thus, will never pay any taxes). Plus, the Toyota factories have a guaranteed customer. These circumstances will allow the Toyota batteries factories to outbid the competition for raw material.

Of course, that's assuming they will need to bid at all. If I had the kind of cash that Toyota has, I would be purchasing the development rights to lithium mines as we speak.

I believe thats no longer an easy option for them.

It doesn't appear ( currently ) they're going to have 'their' way - this time.

[GM-Joe]

If GM builds their own factories in the U.S. to build batteries the workers will strike! For every successful product GM sells, the unionized workers WILL strike! So you might as well do it in China, Mexico, or some other place; it is not like Toyoda is not going to import them, every damn hybrid is imported and they been importing millions of cars per year. So thumbs up to the Chinese!

[HoosierRon]

Originally Posted by GM-Joe

If GM builds their own factories in the U.S. to build batteries the workers will strike! For every successful product GM sells, the unionized workers WILL strike! So you might as well do it in China, Mexico, or some other place; it is not like Toyoda is not going to import them, every damn hybrid is imported and they been importing millions of cars per year. So thumbs up to the Chinese!

GM creates a joint venture with Johnson Controls. The joint venture is its own corporation. It builds a factory in Mississippi and builds batteries for GM using Johnson Controls technology. The factory is not unionized, so there will not be a strike.

So thumbs up to the Americans!

[mgescuro]

Originally Posted by HoosierRon

You won't be laughing when world demand for li-ion batteries causes the price of Chinese made batteries to skyrocket. Meanwhile, because Toyota will be making its own, it will be insulated from the price increase. This will give Toyota a price advantage of several hundred dollars per car.

Ummm... No... Toyota will be subject to the same raw material price increases because they need to buy the raw materials from somewhere, unless TOyota does something to lock in the price.

[K-1]

Originally Posted by mgescuro

Ummm... No... Toyota will be subject to the same raw material price increases because they need to buy the raw materials from somewhere, unless TOyota does something to lock in the price.

Or the Japanese government subsidizes it, like just about everything else... Japan Inc. in full force.

[mbukukanyau]

Originally Posted by logansowner

Same way GM said hybrids were useless and wouldn't sell.

Thing is, Toyota keeps things under wrap until closer to launch than GM does. GM has a tendency to brag about what they can do in 5 years, for instance the Camaro that we've known about for ever, yet still don't have.

If anyone thought Toyota wouldn't have Volt competitor they were living under a rock. Firstly, all major companies tend to get competitive technology at the same pace, usually if someone discovers something major, everyone else knows about it at roughly the same time.

Toyota will have Volt competitor out around the same time as GM, and they've likely been working on it for as long as GM has, only difference is they don't tell the world the day after they get the idea.

GM sucks at this.. I never understood the logic about it. Where you are talking about products you have not even design nor have the technology. Its Dumb

[logansowner]

Originally Posted by mgescuro

Ummm... No... Toyota will be subject to the same raw material price increases because they need to buy the raw materials from somewhere, unless TOyota does something to lock in the price.

But they won't have to worry about the profit portion of the cost, like they would if buying from a private company. If they own it, they don't need to worry about whether it loses money or not.

[logansowner]

Originally Posted by K-1

Or the Japanese government subsidizes it, like just about everything else... Japan Inc. in full force.

Oh crap, a nation helping out a business for the good of it's own people... Why didn't we think of that...

[AMERICA 123]

Originally Posted by K-1

Or the Japanese government subsidizes it, like just about everything else... Japan Inc. in full force.

They really got it on full boil on this one - although it does seem as if you have two ( and a 1/2 ? ), maybe three ( and a 1/2 ? ) possibilities ( not necessarily intended ) as long term contenders over there. ( for battery production )

And then there's Honda, basically trying to get around the whole thing some other way as well.

[zete]

Originally Posted by logansowner

But they won't have to worry about the profit portion of the cost, like they would if buying from a private company. If they own it, they don't need to worry about whether it loses money or not.

The profit margin on most products aren't that great -- excluding software. When you take into account the mining, refining, and manufacturing costs the markup for profit is miniscule. And if the raw material costs go up it'll affect everyone.

And what Japan Inc. can or cannot do is also immaterial. Even Japan has a limited amount of capital and will most probably not subsidize lithium costs as it would be too visible and something that would result in a massive row not only with the US but with Europe and China. A fight Japan cannot win.

The purported subsidizing of the Prius is one thing which, if it happened, was most probably R&D funds provided as research grants into hybrid technologies, something that most Western nations do (see DARPA in the US, for example). It's another thing to claim Japan's gov't actually subsidized the production of the car. From what I've read it sounds like the Japanese gov't may have provided research funding to Toyota to research hybrids. That's no different than what a slew of US gov't agencies do (i.e., DARPA, NSF, EPA, etc.).

[zete]

Originally Posted by K-1

Or the Japanese government subsidizes it, like just about everything else... Japan Inc. in full force.

I always love lines like this. It makes it sound like the US doesn't subsidize anything. It's silly. Every nation subsidizes. Some are better some are worse. No one's an angel here.

[mbukukanyau]

Does GM not own like 51% stake in the battery company they are using?

Originally Posted by zete

I always love lines like this. It makes it sound like the US doesn't subsidize anything. It's silly. Every nation subsidizes. Some are better some are worse. No one's an angel here.

America plays fair than Japan. That is common knowledge. Congress on the other hand is a bunch of morons. Right now they will not approve a trade deal with colombia although Colombian good come into America tarriff and duty free. Why will they not do it? Becouse they know most America think free trade is biased aganist the US. That is political capital exploit ignorance and play to the popular union and masses impressions, instead of doing what is right.
The reality is, this particular deal would result in better terms for US becouse Colombia would in turn eliminate tarriffs on US goods. A Silvarado or Malibu would go from 15% duty to 0% in colombia, imagine how competitive it would be aganist a similar product from Japan...
But Does Congress care? Nooooooo, their goal is to make Bush look bad, not the practical implications of the deal..

Pelosi knows this, with her collegue Harry Reid, but to them, Elections are more important than America's competitiveness

[AndrewGS]

Originally Posted by HoosierRon

Report: Toyota and Matsu****a Building Two Battery Plants

You have to say Matsucrapa.

[mgescuro]

Originally Posted by logansowner

But they won't have to worry about the profit portion of the cost, like they would if buying from a private company. If they own it, they don't need to worry about whether it loses money or not.

A loss is a loss is a loss, whether one division covers for it or not. It's still a loss.

X, Y, and Z battery company will be affected by raw material prices whether they are an independent company, partially owned by a consumer of the product, or part of the kieretsu.

That's the disadvantage of the kieretsu. It's not subject to market forces. If the raw material prices goes up, the company is still on the hook for the product at X cost, whether they like it or not. And the consumer of the product is forced to buy from within, even if the price goes down.

So if GM produces a better battery... Toyota is unable to use it because they have to buy from within.