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green@work : Magazine : Back Issues : Nov/Dec 2002 : Cover Story

Cover Story

The Environment As A Business Opportunity

More Cover Story Articles

- 2010 Global Vision
- The Environment As A Business Opportunity
- Outlining Its Vision
- Environmental Action In North America

In early September, Toyota held a North American investment briefing in New York City that detailed the company’s past, present and future prospects. During the presentation, Cho outlined manyof the company’s global environmental initiatives. Following are excerpts from his presentation that related to the environment:

“Looking back over the patterns of Toyota’s growth over the last 40 years, you can see that the 1970’s energy crises and restrictions on exhaust emissions actually served as catalysts for our rapid development. While global vehicle production over this period increased by 3.3 times, Toyota boosted output by 38 times. This shows that in each growth period, Toyota was able to come out on top because of its competitiveness in technologies.

“As environmental preservation becomes more prevalent on a global scale, Toyota will regard as business opportunities the increasingly tough fuel economy, exhaust emission and recycling regulations being enforced around the world in response to concerns about global warming and other problems. We will continue to invest aggressively to increase our technological advantage with the aim of being the leader in terms of environmental cleanliness, fuel economy, and ‘zero-waste’ manufacturing.

“This technological advantage I refer to is all about two things: products and the means of production. One of our strengths in product technology is hybrid vehicles. We have already applied our hybrid systems in the Prius, Estima Hybrid and Crown Mild Hybrid models, making us a leader in this field. Currently, aggregate global sales of these models exceed 100,000 units, and we intend to increase annual sales to 300,000 a year by around 2005. We are also proud to exceed the world’s expectations about hybrids through continuous performance enhancements.

“We are also working on fuel cells and hybrid vehicles that combine fuel cells and hybrid technologies. Last year, for example, we launched the FCHV-4 vehicle. I would like to emphasize that fuel cell development is a part of our comprehensive Fuel Cell Vehicle Development program. For commercialization of fuel cell vehicles to occur, certain standards must be met—in areas such as reliability, crash safety and ease of installation—and in this respect I believe we have an advantage over competitors that outsource fuel cell unit production. Seven FCHV-4s have already undergone trials on public roads since 2001, five in Japan and two in the United States. We have raised reliability to the point where limited marketing can begin in both countries around the end of 2002.

“I have been speaking a great deal about the FCHV, and now I would like to explain why we chose this name for our fuel cell vehicle. The reason is because we have chosen to adopt what is generally known as the hybrid system, in which a fuel cell is combined with secondary batteries. Other automakers have recently introduced similar systems, but Toyota has always led the world in the development and adoption of this technology. In comparing the overall efficiency of vehicles of different fuel categories, it is necessary to evaluate the overall ‘well-to-wheel’ efficiency, which includes fuel extraction, processing and automobile consumption. At the moment, the efficiency of gasoline-powered hybrid vehicles (HVs) surpasses that of fuel cell vehicles (FCVs). Therefore, by incorporating a hybrid system that can recover and regulate energy to create a fuel cell hybrid vehicle, superior performance can be achieved even when compared with gasoline-hybrid vehicles. As part of our efforts to create ‘superior technologies,’ we are aggressively developing the fuel cell hybrid vehicle to further increase efficiency.

“Toyota has aggressively pursued technological development of a wide range of alternative energy sources, such as compressed natural gas (CNG), diesel engines, gasoline engines, electric vehicles (EVs), and fuel cell vehicles (FCVs). By using them in hybrid vehicles, we are creating synergies and developing the ultimate eco-car—a machine without rivals.

“Toyota believes that environmentally-friendly technologies should be widely available, and for that reason we have stated our intentions to make such technologies available to other car manufacturers upon request. On Monday, (September 2, 2002) we announced a basic agreement on a long-term, continuous transaction of hybrid systems, including technical cooperation, with Nissan Motor Co. The agreement, which aims for a long-term business relationship of 10 years or longer, calls for Toyota to supply state-of-the-art hybrid system components to Nissan. This is our first step to encourage the popularization of our hybrid systems. As an initial project, Nissan will be installing a hybrid system currently under development by Toyota in Nissan’s vehicles to be sold in the United States in 2006. Volume is expected to reach approximately 100,000 units within a five-year period beginning in 2006. In addition, both companies have agreed to start exchanging information and discussing joint development of components related to hybrid systems. Our hope is that this collaboration will help further decrease the cost of hybrid-vehicle components and increase the sales of hybrid vehicles around the world.”


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