Toyota to rethink on 'big electrical appliance'
By Ian Porter
August 8, 2005
Toyota and its hybrid-powered Prius have grabbed the high ground in the battle for the hearts and minds of environmentally-aware motorists, but all is not well in the model's program.
Customers are not willing to pay dearly for what Toyota chief engineer for product planning, Shigeyuki Hori describes as a "big electric appliance".
In short, hybrid versions of many models will just be too expensive, he said.
The sophisticated-looking Prius has been earning rave reviews around the world for its economy and is often cited as the way forward for car design.
There is no doubt Toyota leads the world in hybrid design and sales, and observers believed that all Toyota needed to do to stay ahead was to offer hybrid systems in all of its models, alongside normal petrol and diesel engines.
But when Toyota started to install hybrid petrol-electric drive trains in other models, the gloss soon came off, according to Mr Hori.
"The hybrid versions of the Harrier and Kluger sports utility vehicles in the domestic market have not worked well," Mr Hori said recently.
He says lack of sales success could be because the hybrid system adds 20 per cent or more to the retail price of the two models, which were launched in March.
The worrying aspect for Toyota is that it is spending hundreds of millions of dollars on tooling to make a hybrid version of the next Camry.
Mr Hori said it would be difficult to reduce the cost differential if Toyota continued to make the normal engines and hybrid power units available in the same bodies.
"In an ordinary car you need an engine and transmission. In a hybrid, you also need an electric motor and batteries plus you need a control system for the engine and the motor."
The control system was so complex, the hybrid needed five times the computing power of a normal car. "The price is driven up because you are buying a big electric appliance," Mr Hori said. "It is very difficult to bring down the price premium from between 20 and 40 per cent."
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