Global automakers split on 'green car' strategy

June 18, 2014 by Peter Brieger
Japanese auto maker Nissan Motor's electric vehicles "e-NV200" (L) and "Leaf" are pictured on June 9, 2014 at the company's headquarters in Yokohama, suburban Tokyo

Global automakers are locked in a showdown evoking the video format wars of the 1980s, as they bet on what eco-friendly vehicles will prevail in the battle for dominance of the burgeoning low-emissions sector.

In a contest reminiscent of the scrap for pre-eminence in the , which pitched Betamax against VHS, huge auto firms are going all out for very different technologies.

Toyota, which is ending a battery deal with US electric car leader Tesla, is concentrating on mass-producing a fuel-cell vehicle, along with smaller rival Honda.

Nissan, by contrast, has bet the farm on all-electrics, unveiling its second model this month—despite weak sales of its flagship Leaf—and is pushing the technology in China, where officials are scrambling to contain an air pollution crisis.

Japan's number-two automaker is also reportedly in talks with Germany's BMW and Tesla about standardising re-charging systems, after the US company took the rare step of agreeing to share its patents with competitors to boost lacklustre electric vehicle production.

"Nissan and Tesla... came out with very ambitious goals for the technology but had to backtrack, partly because demand... wasn't strong enough," said Stefan Bratzel, director of Germany's Center of Automotive Management.

"Daimler, Toyota and General Motors are the most advanced in fuel cells, but the problem is the high cost of the technology and necessary infrastructure."

Limited range, high prices

Analysts say very low or zero-emission vehicles will dominate the next phase of independent travel, with governments everywhere rolling out stricter emissions standards.

This near-certainty is sparking massive investment, with Japan's seven major car manufacturers expected to spend a record $24 billion on green car research and development this year, according to the Nikkei business daily.

Detractors says simply shift emissions to the fossil-fuel burning power plants that provide the energy to recharge their batteries. They are also hampered by a short driving range.

The Tesla P85+ all electric car and its charging station is displayed at the North American International Auto Show in Detroit on January 14, 2014

Fuel cell cars, on the other hand, are seen as the Holy Grail of green cars as they're powered by a chemical reaction of hydrogen and oxygen, which produces nothing more harmful than water.

Still largely experimental, fuel-cell vehicles could get a boost as various jurisdictions, including the US state of California, launch new hydrogen refuelling stations.

Toyota is eyeing a 500-kilometre (300-mile) range for its fuel-cell car—more than twice the Leaf's current range—and much faster re-juicing.

The company, while not abandoning electric altogether, sees the fuel cell as the next logical step after its big early success with the Prius gas-electric hybrid, which has sold about 3.7 million units since its launch in the late 1990s.

"Electric vehicles are still so limited by the cruising range," Nobuyori Kodaira, Toyota's executive vice president said in a recent interview.

"Hydrogen can be recharged in three minutes... Quick-charging an electric vehicle still takes about half an hour."

Different paths, same goals

Cleaner power generation, however, may boost the appeal of , said Jos Dings, director of Brussels-based NGO Transport & Environment.

"If... we manage to make electricity in a much cleaner way—there is a lot of investment in renewable energy—then it can definitely be a sustainable way forward," he said.

Still, Nissan's Leaf has shifted about 120,000 units since its launch nearly four years ago, way below expectations.

A Toyota fuel cell concept vehicle is displayed during press event at the Mandalay Bay Convention Center for the 2014 International CES on January 6, 2014 in Las Vegas, Nevada

But its chief executive Carlos Ghosn—a steadfast cheerleader of electric cars who has scoffed at rivals' ambitious plans for a commercialised fuel-cell vehicle —said new re-charging stations will be crucial to demand.

"All of it is very closely linked to the development of infrastructure, but we are seeing more and more competitors coming onto the scene which is always a tell-tale sign," he told AFP earlier this year.

Ghosn was speaking in Bhutan, where Nissan sealed a deal to supply the tiny Himalayan kingdom's government with a fleet of its green vehicles as it eyes an all-electric transport policy.

Governments throwing their weight behind strict roadside pollution standards and other environmentally-minded policies is crucial, analysts said.

"I don't think GM, Ford and Chrysler look at green cars as a profit opportunity or big growth opportunity in which they are sensing a lot of consumer demand or growth—their goal is to meet what the government requires from them," said US-based auto analyst Jack Nerad.

Whether one technology ultimately reigns supreme, or they co-exist with a patchwork of refuelling stations, may not matter much, added the environment group's Dings.

"All carmakers are now seriously investing in developing these technologies, seeing how customers react to them, seeing how they work on the road and how much they cost," he said.

"They all chose different paths and that's fine, as long as the solutions deliver."

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3 / 5 (2) Jun 18, 2014
Electric cars take longer to charge, but they have one big advantage. There is a refueling station in every home. If you just charge it at home overnight, 30 min or 1 hr or 6 hrs makes no difference. The limitation is that you can only go 80 miles or so, or a 40 mile roundtrip. But this is no limitation for a commuter and errand running vehicle. 80 miles roundtrip is a perfect range for a second car used around a big or small town. It cannot be your only car, but it can most definitely be a second car that you take to work every day, drop and pickup kids, etc.
Fuel cell cars are the greenest. But they are so horribly expensive that they are completely pointless outside of auto shows. And you cannot charge them at home, so you require an extensive network of stations. Unless there is some breakthrough that allows one to sell them in sub 40K and sub 30K range, they are simply useless.
3 / 5 (2) Jun 18, 2014
It cannot be your only car, but it can most definitely be a second car that you take to work every day, drop and pickup kids, etc.

I.e. if you're middle-class and above.

And you cannot charge them at home, so you require an extensive network of stations.

Fuel cells work on methane and other hydrocarbons as well. The whole hydrogen business is just a red herring used to collect "green credits" and government research grants because it will never be actually viable with too many safety issues, lack of infrastructure or source, and an impractically low energy density.

Methane is available is your house's gas main - all you'd need is a compressor to recharge your fuel cell vehicle at home.
not rated yet Jun 18, 2014
Near term, H2 FCEVs will not be green. The H2 will come from natural gas. That will be purely an economic decision.

Adding a significant number of H2 FCEVs to the highways will speed the end of NG. After that the H2 will probably need to come from cracking water and that takes ~2x as much electricity per mile as driving an EV.

The extra electricity cost plus distribution costs will result in EVs being much cheaper to drive. (And better for the environment to the extent that there are still fossil fuels on the grid.)

Recharge time is not a real issue for the large majority of drivers. With a 200 mile range EV one will get to destination only a few minutes later on an all day (500 mile) drive. Two ~20 minute stops vs. one ~5 minute stop. Except that the EV driver can also eat a meal, hit the toilet, grab some coffee/whatever while charging. Those will be extra stops/time for the FCEV driver.

Then, the FCEV driver will be stopping to refuel all the other weeks....
not rated yet Jun 18, 2014
Fuel cell cars are LESS "green" than battery powered electric cars such as the Tesla Model S.
Fuel cell cars are less efficient and the creation, distribution and storage of the hydrogen fuel costs energy as well. Fuel cell technology does however maintain the current business structures where big corporations are selling us a limited product, so I imagine there are major forces at work to keep things they are. With battery powered cars this structure is no longer as relevant.
5 / 5 (1) Jun 18, 2014
Batteries and EVs will also become big businesses. The route to least expensive runs through economies of scale.

Big car manufacturers will make whatever vehicles the market wants. We see them shift from big sedans, to economy cars, to minivans, to pickup trucks, to SUVs, back to pickup trucks, to efficient sedans/crossovers, to ....

Will Big Oil try to steer things to H2 in order to have a new fuel market? Will they move their capital to batteries or another non-fuel investments (as Chevron has done with geothermal to some extent)? Or will they ride their dinosaurs into the dust?

Time will tell, and all that stuff....
not rated yet Jun 18, 2014
I sure hope US automakers are willing to invest as much as the global automakers are in the research of these "green" technologies auto's. If they approach this as just a "trendy" type technology they will find themselves one again struggling to catch up to the asian car companies for years,much like what happened with the ICE vehicles.
not rated yet Jun 18, 2014
There are two large American car manufacturers (GM and Ford) and one small, exciting American car manufacturer (Tesla). Chrysler is really Fiat and Italian owned.

Both GM and Ford have PHEVs and EVs. They're (probably) ready to go big once battery prices have fallen low enough to make the electric market take off.

Ford did something very interesting with their Focus assembly plant. They set up three assembly lines and can switch over a line from fuel to hybrid or electric in well less than a week.

Car manufacturers are not likely to be heavily involved in battery research. They seem to be waiting for other companies to do the battery work. Tesla doesn't (AFAIK) do battery research. They are branching off into battery manufacturer but it seems they are using technology developed by others. Same with Nissan and their battery plants.

BTW, GM is leading the development of PHEVs and Tesla is leading the development of EVs.

Both American companies.
not rated yet Jun 19, 2014
Adding a significant number of H2 FCEVs to the highways will speed the end of NG. After that the H2 will probably need to come from cracking water and that takes ~2x as much electricity per mile as driving an EV.

H2 is still a red herring. It makes absolutely no sense to use it and it will not be economically viable.

Methane on the other hand will be easily available through power-to-methane conversion from buffering renewable energy from solar and wind on a much more massive scale.

Power-to-methane conversion is many many times cheaper at volume than trying to store the energy in batteries, because the batteries too have round-trip efficiency losses and manufacturing costs (ESOI).

That's one of the hidden costs of EVs, because every quick charging station needs a battery itself to spread the load over a longer time. Otherwise they would simply crash the grid. You get significant losses there by putting the energy through at least two batteries if not more along the way.
5 / 5 (1) Jun 19, 2014
"every quick charging station needs a battery itself to spread the load over a longer time"

Were that true then the amount of electricity used would rise by about 10%. Not a very large number. However, rapid chargers do not use batteries.

From the Tesla site -

"... here's how a typical (in this case the Port St Lucie, FL) supercharger infrastructure is configured:

The eight bay setup takes a 12kV, 750kVA feed from the utility, steps it down to 480V three phase on site, pushes that into 2000A switchgear which feeds four (one for each pair of bays) SuperCharger units at 480V/200A. Each unit contains 12 [Model S] 10kW rectifiers for 120kW."

1 / 5 (1) Jun 21, 2014
If allowed the Invisible Hand© will sort it out.

If Government gets involved there is no telling how FUBAR things will become.
not rated yet Jun 24, 2014
However, rapid chargers do not use batteries.

If so, then rapid chargers cannot become widespread because there's a very high probability that too many people will happen to charge at the same time and cause a complete blackout.

750 kVA is 0.75 Megawatts

If a thousand chargers across the US happen to operate at the same time, that becomes 0.75 Gigawatts. A hundred thousand, 75 GW... etc.

And as large electricity consumers are typically not consumer priced, but follow electricity spot market prices, the large surge of demand will cause a corresponding surge in electricity prices for the local grid including the charging station, so widespread rapid charging infrastructures without buffer batteries would make no economical sense either.

not rated yet Jun 24, 2014
Were that true then the amount of electricity used would rise by about 10%.

Batteries have both ESOI and efficiency, and you must not forget the systems efficiency. Lithium batteries have an ESOI of 10:1 and the electrical system in the rapid charger is about as efficient as the electric car itself at around 85% with conversion losses (rectifying, regulation, inversion, transforming) included because the system is functionally identical. Having a quick charger with a battery is technically very similiar to having a permanently parked electric car that is only used to recharge other electric cars through its motor inverter output.

That puts the real energy cost of rapid charging infrastructure at 23%, or slightly less than a quarter of the throughput.

In other words, you need to spend 29% more energy to quickly charge your EV as compared to charging directly from the wall.

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