Toyota is diligently
working to change the automotive landscape. Sure, the numbers aren’t big now,
but consider this: in Toyota’s first full year of business in the U.S., 1957,
it sold 287 Toyopets. Two years of similarly anemic sales followed. Toyota withdrew
from the market. The Camry was the number-one selling car in America in 1997,
1998, 1999, 2000, and 2002. Don’t let initial small numbers lull you into a
sense that everything will remain the same. It won’t. Which is why the Prius
is so important to the industry. By Gary S. Vasilash, Editor-In-Chief (ADP)
Go deeper with GlobalData
Don’t Play Craps
with These Guys.
If you want to understand the future of automotive design and production—what
you do for a living, not this publication—then you have to understand the
Toyota Prius. The 2004 Prius. The second-generation. While some vehicle manufacturers
are researching and developing, or hemming and hawing, Toyota, which is certainly
on track to achieving a technology position that’s commensurate with its
quality and productivity positions (which ought to scare the hell right out
of vehicle manufacturers everywhere), has been deliberately working toward bringing
alternative power trains to the streets of the world. This began in earnest
in the early 1990s, when the G21 committee was established. That’s “globe”
and “21st century.” The goal was to determine how the company could
develop and market vehicles that would have low emissions. Late in 1994, about
a year after the committee was formed, a concept vehicle was developed called
the “Prius,” taken from the Latin word for before, as in “ahead,”
not something from the past.
The concept was shown to
the world on October 27, 1995 at the Tokyo Motor Show. But prior to that and
not on the world’s stage, on June 30, 1995, the development of a hybrid
vehicle was approved by Toyota corporate officials. It was code-named “890T.”
The vehicle would be powered with what was (and is) called the “Toyota
Hybrid System,” a system that would combine an internal combustion engine
with an electric motor. The undertaking went in short order from being the sort
of thing that committees do to a full-out product development program. In December
1995 it was announced that the hybrid vehicle would go on sale in Japan in two
years’ time. And on December 10, 1997, it did.
In August 2000, Prius was
launched in the U.S. with an MSRP of $19,995. Prius sales in the U.S. were 15,556
in 2001. They increased to 20,119 in 2002. Certainly this is not a whole lot
of cars by any measure. But there was Toyota (joined only by Honda with its
Insight and Civic Hybrid), selling a compact car that was providing an estimated
52 miles per gallon in the city and 45 on the highway, learning not only about
developing hybrid vehicles but about selling them in a market where horsepower
tends to be king. (The ‘03 Prius has a four-cylinder DOHC, 16-valve engine
that provides 70 hp @ 4,500 rpm that can be supplemented by a 44-hp permanent
magnet electric motor for a total of 98 hp in action.)
|
| The 2004 Prius. A second-generation vehicle with third-generation gas-electric hybrid technology under the hood. A car of the future. At your Toyota dealer now. |
Speaking of the launch in the U.S., Don Edmond, senior vice president and general
manager of Toyota Motor Sales, admits, “Frankly, it was one of the biggest
crapshoots I’ve ever been involved in. Not because we lacked confidence
in the quality of the product. Or the logic of the concept. Or the significance
of this breakthrough technology. The key was to convince consumers in the U.S.
that hybrid technology was more than a science project. More to the point, the
key would be convincing them that Prius was a real car.” Arguably, other
efforts by other companies did smack of Dr. Science and Rodney (“Remember:
He knows more than you do”), or seemed to be put off to some point in the
ever-receding Future.
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By GlobalDataThis Is A Business (or,
It Takes Money To Make Money).
At this point, there is an oft-heard objection regarding Toyota selling the
Prius at a loss and subsidizing the cost of the vehicles. Here’s Masao
Inoue, Prius chief engineer, Toyota Motor Corp.: “Toyota has largely recovered
its initial long-term investment in the first-generation Prius.” Here’s
Dave Hermance, executive engineer, Regulatory Affairs, Toyota Technical Center,
U.S.A.: “The product is profitable.” How profitable is a question
that’s unanswered. At least at this point in time. Presumably, in the years
ahead, that will be something that should become clear.
The Benefit of Doing
It Yourself.
But there’s something that needs to be understood about the development
of the first-generation Prius, development that has led to a superior electric-gas
hybrid technology that’s designated “Hybrid Synergy Drive” (which
is actually the third generation gas-electric hybrid system Toyota has developed).
According to Inoue, “Back in the early ‘90s, when Toyota was developing
a business case for hybrid technology, it was decided that the engineering program
would need to be done almost entirely in-house. This meant that nearly every
bit of design, engineering, parts production, and assembly would be done in-house.
No partnerships. No contractors. No suppliers of major components or systems.”
In other words, when most vehicle manufacturers were looking for the ways and
means to outsource the design, engineering and manufacturing of even conventional
technology components and systems, the people at Toyota decided that it would
be in their long-term best interest if they did the development.
 |
| Under the hood of the Prius: a 1.5-liter Atkinson cycle engine that works (when needed, and vice versa) with a 50-kW electric motor. Fuel efficiency is in the mid-50 mpgs. And it’s comparatively quick: 0 to 60 mph in 10.1 seconds. |
Part of the rationale of this approach is that there is a consequent thorough
understanding of not only the overall system, but of the elements of that system.
Consequently, when it makes business sense to outsource, then there is internal
knowledge of what is doable, which means that there can be a clearer understanding
between the customer and the supplier vis-à-vis realistic expectations.
(It has also permitted Toyota to be in the position to derive revenue from licensing
the technology to Nissan, which is expected to be selling its gas-electric hybrids
in the U.S. in 2006.)
Inoue observes, “The Prius, unlike so many other vehicles in our lineup,
shares almost no common parts of significant cost. It is a singular and unique
vehicle in our lineup. Yet through in-house R&D we have been able to significantly
reduce the cost of major hybrid components and sophisticated support systems.”
One result of that is that the 2004 Prius, which is classified as a “midsize”
car as compared with its “compact” predecessor, a vehicle that boasts
(relatively speaking) the same-size internal combustion engine but one that
produces 78 hp @ 5,000 rpm and a permanent magnet electric motor that provides
67 hp for a total of 106 hp in action, is priced at $19,995. More car for the
same price. And, with the exception of Honda, Toyota remains the only company
with a serious commercial alternative propulsion program that extends beyond
the lab and into retail dealerships.
Don Esmond asserts, “We are targeting a sales volume of 36,000 for the
first full year. That’s three times our sales target for Prius when it
launched in the U.S.” Still, not a huge number by the typical metric of
midsize sales. But take these facts into account: (1) it is unlike any other
midsize car so compared to others, that 36,000 is an enormous number and (2)
the Hybrid Synergy Drive is slated to be put into a variant of the Lexus RX330
sport utility vehicle next year (mated to a 3.3-liter, V6 engine, not a diminutive
1.5-liter four-cylinder), and the RX330 is the leading SUV in its class. What’s
more, can anyone honestly think that Toyota won’t be equipping more vehicles
with the technology that it has worked so diligently to develop—technology
that no one else has on the market—that we won’t see the Highlander,
Corolla, RAV4, Camry, and who knows what else equipped with hybrid systems?
When the first Prius was launched, it included more than 300 patents. The second-generation
vehicle has 370. It’s intellectual property transformed into physical product,
which is clearly a competitive advantage in the market.
From the Sublime to the
Simple.
Dave Hermance notes that there are a variety of elements that contribute to
the performance of the Hybrid Synergy Drive. (A brief take on how the hybrid
performs. When starting from a stop, the battery will pass energy to a high-voltage
power circuit, which passes it to an inverter, then to a motor that powers the
wheels. When a cruising speed is reached, the Atkinson Cycle gasoline engine
is deployed; it passes power through a splitting device: one stream powers a
generator, which powers the electric motor, which passes the power to the wheels;
the other stream directly drives the wheels. When there’s sudden acceleration,
then the battery power kicks in to supplement the power from the motor. During
braking or coasting, energy is recovered from the wheels: the motor operates
as a generator that puts power back into the battery.) One of the changes with
the new system is the high-voltage circuit between the battery and the generator,
which increases the voltage to the motor above the battery voltage. The battery
pack still provides 21 kW, but it is smaller (which means they’ve created
a higher power density) and less costly to produce. One of the objectives of
the Prius is to have low emissions (it is rated under the California Air Resources
Board as an SULEV (Super Ultra Low Emission Vehicle) and as an Advanced Technology
Partial Zero Emission Vehicle (AT-PZEV)). When the Prius is stopped, the engine
isn’t running. One of the concerns with cold starts is that because combustion
isn’t as efficient as it is when the engine is hot, there are greater emissions.
So the Prius has a three-liter vacuum bottle that’s used to store high-temperature
coolant. The hot coolant is dumped into the engine when there’s a cold
start. Simple but effective.
Just a Car. Loaded.
Assume that the 2004 Prius doesn’t have a Hybrid Synergy Drive. Assume
that there are no nickel-metal hydride batteries. No electronically controlled
continuously variable transmission. No inverter or high-voltage power circuits.
That it is just a conventional car. Even then, it is a remarkable car. There’s
space for both people and cargo: 96.2 ft3 of passenger space (as compared with
101.7 ft3 in the Camry) and 16 ft3 of cargo volume. There’s the smooth
monoform design for the five-door hatch that provides a coefficient of drag
of just 0.26. There’s throttle-by-wire rather than the conventional cable-type
throttle. Air conditioning (using an electric-powered air compressor), cabin
filtration, cruise control, heated side mirrors, power windows and door locks,
and keyless entry are standard. And about that “keyless entry.” That’s
certainly the case with the “Smart Entry and Smart Start” option.
The driver has the key fob in a pocket or purse. When the driver grabs the door
handle a sensor receives a signal from a transponder in the fob, and unlocks
the door. To start the car, the fob is inserted in a slot in the instrument
panel and a push-button is depressed. This is the first time Toyota has used
this technology on a vehicle. With regard to driving performance, the vehicle
handles well, thanks in part to the use of independent MacPherson struts with
stabilizer bar in the front and a torsion beam with stabilizer bar in the rear
and 15-in. all-season tires. The first-generation Prius is a compromise in many
ways: looks, amenities, handling, performance. This is decidedly not the case
for the second-generation car.
 |
| Fujio Cho, Toyota Motor Corp. president, and the Toyota FINE-S concept at the 2003 North American International Auto Show. Looking and working toward the future. |
The Future Is. . .
Which brings us back to the start. The future of the auto industry is not going
to be more of the same. It is not going to be the past repackaged. Presently,
the market still demands bigger vehicles and higher horsepower. Government regulations
don’t seem to be inclined to dissuade that state of affairs. Presently,
the attention that the Prius is garnering is related mainly to movie stars and
to environmental activists—both groups certainly not of the mainstream.
But there’s something to consider. In January 1992, Toyota Motor Corporation
announced its “Earth Charter.” Among other things, it led to the G21
committee, which led to the Prius. In April 2000 the “New Toyota Earth
Charter” was announced, and the “Third Toyota Environmental Action
Plan” is underway, a plan that encompasses the period from 2001 to 2005.
Within the charter, the number one action guideline is: “Always be concerned
about the environment. Challenge achieving zero emissions at all stages, i.e.,
production, utilization, disposal.” The first subset of that guideline
states: “Develop and provide products with top-level environmental performance.”
The action items related to that are: fuel efficiency; exhaust emissions; clean-energy
vehicles; recoverability; substances of environmental concern in products; automobile
noise; air conditioning systems.” One way of interpreting the Toyota Production
System is through the commonly used phrase: “Plan your work and work your
plan.” Toyota has the plans. Toyota is doing the work. Beyond the Prius
there is technology that was introduced to the world at the 2003 North American
International Auto Show by Toyota Motor Corp. president Fujio Cho, Toyota FINE-S,
or Fuel Cell Innovative Emotion-Sport. What it lacks in grammatical harmony
it makes up for in technological potential. Cho stated during the introduction:
“The FINE-S represents what fuel cell cars will be like in the future.
By using simple, modular parts and electric motors on all wheels, we can create
vehicles that look fantastic and are high in performance in any configuration.
We believe this freedom will help us design vehicles that will strongly appeal
to the emotions and tastes of almost every driver.” A concept, yes. But
one that’s backed by a plan. Can there be any question that companies that
truly do the work—the inventing, developing, designing, engineering, producing,
marketing, selling—will be the ones that will be successful, while those
that do the science projects and spout the platitudes will be those who are
left behind?
