If you’re looking for evidence that the auto companies are resisting the migration to EVs, here’s news from sunny California. It appears that Honda, Hyundai, and Toyota have successfully lobbied the California Air Resources Board (CARB) and members of the California State Legislature to open a gaping loophole in the new zero-emission vehicle mandate. Now, automakers that ‘overcomply’ with the new Federal greenhouse gas (GHG) standards can get away with producing fewer EVs. This sweetheart deal allows an automaker to cut the number of pure electric-drive vehicles by as much as 50% over the 2018 to 2021 timeframe in exchange for just 2 grams per mile GHG overcompliance during that time.

Jay Friedland of Plug-In America, whom I interviewed for my first book (Renewable Energy – Facts and Fantasies) sums it up: This is a bad deal for California and for the United States.

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I often wonder what caused Toyota to invest $50 million in Tesla. Obviously they deemed it important in expediting their introduction of electric vehicles.  But doesn’t a company the size of Toyota have a considerable gaggle of engineers who know their way around EVs, after a decade of tinkering with the Prius? 

Perhaps Toyota is so wrapped up in engineering and PR problems that it wanted to get some of the R&D workload in electric vehicles off its plate.  Or maybe they figured that Tesla’s nimble management style might be able to make faster progress.  And note that currently, Toyota is not only a stockholder, but a customer as well; it placed an order for 35 electric conversions of the RAV4 EV, the competitor to the Ford Escape, Honda CRV, and Chevy Equinox, all small sport utility vehicles.

I know others also struggle to make sense of some of the auto behemoths’ decisions, but I find Toyota’s behavior in the EV space to be especially mysterious. After the homerun they hit with the Prius, it seems otherworldly that they haven’t done a better job in advancing electric transportation. They claim to they have no fewer than 10 EV models “under development,” and I suppose that could be true. But why on Earth would you wait while other folks take the lead and render you an afterthought in a strategic part of the industry?

Here’s a theory: it’s obvious that the car companies have gone into the EV age kicking and screaming. But resisting this change, while it was certainly in their interest, was not within their power — and now their hand has been forced. My guess is that Toyota misread the timing of the pressure they would receive from Nissan and the others. Now, they’re playing catch-up — and under horribly adverse circumstances – part of which is the damage they sustained recently to their supply chain, with numerous vendors wiped out by the tsunami.

Nothing else can explain their lethargy in this space, and announcements of totally lame products, like the Prius V. Here we are in mid-2011 and the new Prius still has no plug?

Sorry.  No plug?  No deal.　

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To its everlasting credit, Toyota changed the transportation world forever when it introduced the Prius – the first production hybrid electric, making use of a battery to improve a car’s gas mileage. But that was over ten years ago — a different epoch – maybe even an era – in automotive time.  What has Toyota done since?

I hate to sound unkind, and I know I’m oversimplifying. But the truth is this: very little.

Now, in reaction to the rest of the auto world’s having leapfrogged Toyota several times, we see the introduction of the plug-in version of the Prius, slated for 2013, and perhaps available in 2012. Its highlight? A tiny battery that will provide drivers with 13 miles of battery-only range before the internal combustion engine kicks in and starts burning the gas in its tank. In fact, the battery holds just seven kilowatt-hours, the energy equivalent of less than a quart of gasoline.

The result? A marginal improvement in gas mileage, more than a decade later.  I’m not sure that qualifies Toyota as the “visionary leader” it claims to be.

In fact, here’s your new value proposition, Prius loyalists: unless you live close enough to everything that you really don’t even need a car in the first place, now you have to BOTH fill your car up with gasoline AND plug it in at night.

This is, by all odds, a very unattractive proposal.  And Toyota seems to know this.  How do I know that they know?  Methinks they dost protest too much.

Their presentation this afternoon at the AABC (Advanced Auto Battery Consortium) was built around the findings of their market research which pretended to show that consumers are going to love the car.  But the study was such an obvious sham that its only possible purpose could have been to convince us of something that is impossible to believe: that consumers, two years hence, will want a plug-hybrid with a 13-mile battery-only range. 

We sat through tons of bar charts that showed that the very leading edge of EV early adopters don’t mind plugging in their cars. (Didn’t we already know that?) And therefore, the Toyota plug-in hybrid is bound to be a hit. (Isn’t this a totally irrelevant conclusion?)

I could see heads in the audience near where I was seated nervously turning around, anxiously trying to see if others had grasped a point that they might have missed. Could a legitimate study possibly have shown that car buyers really are anxious to inconvenience themselves to buy this car?  No.  It was nonsense, and many of us knew it.

How did AABC select Toyota to present this outrageous propaganda?  I don’t know. Does a market cap of $130 billion and the power behind it buy anything in today’s world?

Hold on, let me check on that. 

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I was incredulous. Maybe they want that now, pal. But do you honestly think they’re going to want that two years from now, when they can have a LEAF, an I-MiEV, a Mini E, a Volt, or half a dozen other EVs of various sizes and types? You’re going to ask them to go through the exercise of plugging their car in, just to get slightly better gas mileage?

This is a truly terrible idea. I have to think something has gone terribly off the rails there. Unless they make a major change, I predict that Toyota’s decade 2005 – 2015 will be the biggest single meltdown in automotive history.

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…both Toyota and Honda had until recently thought that the era of hybrids would continue for a while before electric vehicles began to gain popularity. But the automakers are now accelerating their efforts to develop electric cars, and there are two main reasons for this. One is the tough new fuel economy rules the US administration of President Barack Obama will introduce in 2012…The second reason for the heightened focus on electric cars is China’s move to promote them.

 This advice, which is what millions of other people and I have been saying for years, is so obvious that it’s really rather ridiculous. Both Toyota and Honda, with their huge balance sheets and engineering staffs, could have done this in a heartbeat anytime they wanted over the past decade. Why didn’t they? I can think of only one reason – that they were already perceived as green – and saw no reason (other than decency) in offering a product that would bring an end to an existing profit stream.

Now, their backs are up against the wall, forced to move fast to avoid being marginalized in a world that’s running 100 MPH towards EVs. I hate to sound like a Monday-morning quarterback, but couldn’t someone somewhere have seen this coming?

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You may have noticed that last week brought us another wrinkle in the litigation in which Florida-based Paice Corporation sued Toyota and Ford Motor Company – a dispute involving Paice’s assertion that both the Toyota and Ford hybrid drive systems violate its patent and that it is entitled to compensation.

When I came across this sentence: As you might imagine, Toyota certainly wasn’t happy about the Texas jury’s decision, nor when they lost their apparel to the U.S. Supreme Court, it took we a few seconds to discern what Bill had intended. They lost their shirts, perhaps? No, I ultimately realized that what they had lost was their appeal, not their apparel.

So what was the news? None of the parties in the lawsuit will say how they settled, but Bill thinks “we can safely assume that Paice and its attorneys broke out bottles of bubbly last week, even if they it means they’ll likely never do business in Detroit again.”

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In particular, note the recent comments of GM’s Bob Lutz, global climate change skeptic, who is nonetheless a strong proponent of the Volt and the electrification of the automobile. Lutz argues that continued dependence on oil as demand inevitably increases will simply exacerbate boom and bust economic cycles. He notes that, in 20 years the China auto market will equal the rest of the world combined and adds, “At that point we have to have alternative drive systems, which to me have to be electric.”

And check out the remarks of Jim Lentz, President and COO of Toyota Motor Sales. He apparently stunned his interviewer during a recent Commonwealth Club event, in which he stated unequivocally that Toyota believes that peak oil will occur sometime in the later half of this decade.

Peak oil – just one of the many reasons for the rapid migration to renewable energy.

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Not everyone agrees with me on this, but I find this product — and the timing of its launch — a considerable snooze. Toyota could have had a plug-in hybrid with 30 – 50 mile electric-only range in the market many years ago. Why didn’t they? Because it wasn’t in their interest to do so. They were already perceived as “green” (with the Prius), and there was nothing in it for them to move this along until they absolutely had to.

This offering is good for Toyota in every way. The small battery pack will be easy to build, support, sell – and ultimately replace with new technology as soon as it comes along. The fact that most drivers will be disappointed in that they will continue to use gasoline on a daily basis is apparently not a significant part of the equation.

I’m reminded of shopping at Costco, the experience of which always leaves we thinking: I’m not buying what’s good for me; I’m buying what’s good for Costco to sell me – whatever they can source inexpensively, and sell in quantities that are almost always far greater than its customers want. Need a canister of salt? Think you can get it at Costco? No, if you want salt, you get a 25-pound sack – sufficient to last a family of four about 30 years.

But is it fair to expect altruism from Toyota — or any other corporation, when their sole purpose is to make money? Today’s corporate titans think of themselves as “customer-focused,”  though that’s for business reasons, not out of true concern for fulfilling customers’ needs.  If that weren’t the case, we woudn’t have planned obsolescence — products that are built to wear out and fall apart, necessitating replacement by new ones. 

The bottom line is this: at the end of the day, electric transportation will not come from the “push” of the OEMs; the only thing we have going for us is the “pull” from customers like me (and, I hope, like you) who simply refuse to buy another 25 MPG planet-buster.

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