Toyota's Problem With Plug-in Hybrids

NEW YORK CITY--The "Meeting of the Minds," an international city planning conference held in the most urban of settings (the 60th floor of a JP Morgan Chase office tower) was perhaps an unlikely setting for a tutorial on the inherent problems of plug-in hybrid (PHEV) cars, but Toyota was the main sponsor and it had a point to get across.

The PHEV question was addressed both by Irv Miller, Toyota's group vice president of environmental and public affairs; and Bill Reinert, the company's national manager of advanced technology. Although Toyota will roll out its own leased fleet of 500 Prius-based PHEVs in what it calls a marketing experiment, their main point was that PHEVS cost too much for too little environmental benefit.

Instead of the 100 miles per gallon equivalent that some proponents claim, the plug-in reality is between 50 and 55 mpg, they said--not better than the third generation Prius that the company is not coincidentally just rolling out.

Miller said that the promise of the lithium-ion battery pack--used in both PHEVs and pure battery EVs--has led to "inflated expectations beyond the technical realities." As evidence of irrational exuberance, he cited both San Francisco Mayor Gavin Newsom's declaration that traditional hybrids are "yesterday's technology" and President Barack Obama's pledge to have a million PHEVs on the road by 2015.

For Miller, it's not altogether clear that consumers are willing to pay a premium for the extra miles of all-electric range that PHEVs offer. "Judgment Day is just around the corner," he said. "And the challenge here is that after the charge runs down you're carrying around 300 pounds of dead batteries. The dog doesn't hunt."

Reinert cited studies from both Carnegie Mellon and Duke Universities that are skeptical of PHEV claims. In a chart-heavy presentation, he said that carrying around extra battery weight means increased diameter steel for subframes, bigger brake size and larger springs. "There's a big weight penalty, and you're always paying it," he said. "There are diminishing returns when you keep increasing the size of the battery pack."

Reinert says PHEV buyers will be trading in Priuses and other hybrids, not Hummers (further diminishing the green advantage). Of course, battery advances could considerably reduce the size, cost and complexity of larger-output packs, but Miller said that battery technology has lagged behind that of hydrogen fuel cells.

Toyota is scheduled to introduce an urban electric car (based on the tiny iQ) with a range of 50 miles in 2012, and a hydrogen fuel-cell car in late 2014 or 2015. But Reinert bemoaned the difficulties of urban EV charging, and Miller questioned Energy Secretary Steven Chu's $100 million cut in 2010 hydrogen funding. The federal government, he said, "should not be playing technology favorites for political expediency."