Toyota's Hydrogen Fuel-Cell Car (Photo : Getty Images)
China's policies on new energy vehicles (NEV) have compelled Toyota to reverse its plan to introduce its own hybrid and hydrogen cars to China; instead, it will sell plug-in electric hybrid cars next year and an all-electric battery car in the future, Business Insider reported.
But previously, Toyota was opposed to full electrification as it planned to use hydrogen as the main alternative to gasoline-fueled cars, avoiding the all-battery cars.
Takeshi Uchiyamada, Toyota chairman and father of the gasoline-electric hybrid Prius, said in 2013 that the hydrogen car was a "practical alternative" to conventional cars and referred to electric vehicle (EV) as "only as a neighborhood errands car."
However, late last year, Toyota announced that it had started developing an all-electric battery car, with Akio Toyoda, its president, as the manager of the new unit called the EV Business Planning Department.
According to one Toyota executive who refused to be named, the turnaround has been an "agonizing" and "heart-wrenching" experience for Toyota.
The Japanese automaker had earlier predicted that conventional hybrid cars and plug-in hybrids would be the stepping stones to hydrogen-fueled cars of the future.
In 2014, the company launched its hydrogen fuel-cell car, the Mirai, which sold for 7.24 million yen in Japan and $57,700 in the U.S., before subsidies and rebates.
However, China's tough policies for cleaner energy cars challenged global automakers, including Toyota.
In September, China released draft proposals which require that 8 percent of automakers' sales should come from battery electric or plug-in hybrid vehicles by 2018, to be raised to 10 percent in 2019 and 12 percent in 2020.
Toyota and other automakers, however, said that they have not seen any fundamental change in China's campaign to use electric cars by 2020 as well as promote cleaner energy cars in the China car market.
Based on the proposed policy, conventional hybrids like Toyota's Prius were classified as gasoline-fueled cars, according to Toyota. This means that the Prius would not be able to receive new energy vehicle (NEV) credits, which automakers use to meet the standards of fuel economy rules.
One point is deducted from an automaker's NEV credit for each hybrid car sold in China, the proposal mandates.
"The Prius and other hybrid cars are central to our green car strategy," one Toyota executive said. "But in China's view, the Prius is no more than a gasoline car. We have no choice but to get over our EV allergy and come up with an electric car."
Ahead of the Shanghai Auto Show, Hiroji Onishi, the head of Toyota's China business, announced on Tuesday, April 18, that they would start selling plug-in electric hybrid cars in the country next year, as well as an all-electric battery car later.
To meet China's fuel-economy requirements and new energy vehicle quotas, Toyota will try to sell more conventional hybrids, Onishi said.
In the first three months of 2017 alone, Toyota has sold nearly 300,000, an increase of 1.7 percent compared to the same period last year.
