What Ford and Chevy can learn from Toyota’s dedication to hydrogen
Toyota’s long-term design for hydrogen has astounded and confounded the automotive world. Sometimes it seems that Toyota’s quest to put a hydrogen tank under every new car is as expensive and foolish as the various attempts to build an exact copy. Titanic. Mocking Toyota’s hydrogen campaign is a reliable and easy way to prove yourself online as a truly knowledgeable leader of like-minded people. However, Toyota’s devotion to selling electric cars that most of the world cannot drive (without special fuel) offers lessons that the Big Three American companies refuse to learn.
Build your reputation before you need it
Toyota’s path to electric vehicles has been one of the most exciting but inconsistent in the industry. The company got off to a profitable early start when it introduced the world to hybrid cars at the turn of the millennium, then faltered and seemingly backed away from electric cars entirely, until this year. But perhaps more shocking is that Toyota’s first hybrid was not an “enthusiast coupe” but rather an unusually boring car.
In essence, Toyota bypassed the world of car enthusiasts, instead selling the Prius directly to commuters who didn’t care about drivetrains rather than overhead cameras. This sparked a feud between gearheads that continues to this day (taking verbal potshots at a Prius remains a popular sport among motoring authorities). But no matter how many auto industry authorities scoff at so-called “hybrid cars,” Toyota remains the last word on hybrids.
Toyota appears to be trying to achieve hydrogen dominance in the same way. The company’s designs target people who He buys Cars rather than the people who review them. Instead of having two doors and two seats, the Mirai hydrogen sedan looks like a close relative of the Camry. Toyota’s latest fuel cell project is the hydrogen-powered Hilux truck. Toyota has also built hydrogen-powered semi-trucks. However, the company has not announced any “enthusiast” hydrogen cars with two doors, two seats, and a two-inch ride height. The market for hydrogen cars is small enough without excluding people who will never own a car trailer.
By making hydrogen cars as accessible as possible, Toyota captured a significant market share before the market even existed. If hydrogen takes off, Toyota will already have at least fifteen years of roadworthy cars to base its advertising on. This is something that American companies tend to place less value on, if not ignore. After all, it’s hard to put “reputation” on a list of company assets that has monetary value next to it.
If your company is doing well, invest a lot of money in “unprofitable” R&D.
If a company is making huge profits, it is always a good idea to spend a significant portion of that money on research and development. Toyota’s heavy spending on hydrogen may seem reckless to American automakers, but it illustrates a crucial difference between Japanese and American companies. US companies tend to race feverishly from quarter to quarter, but Japanese companies seem more inclined to plan for the long term. Toyota is certainly willing to take the present loss on hydrogen (or at least, a sharply diminished profit) because it may pay off in the future.
R&D rarely generates profits on its own, which is why American companies often cut off funding for it. While the company can certainly save money in the short term by firing scientists, this inevitably leads to future losses. It is certainly never wise to throw buckets of money down the drain of foolishness. But many American companies go too far in the opposite direction, cutting promising projects when they fail to turn a profit before the end of the quarter. To look at the history of American concept cars is to embark on a long journey of sighs about what might have been.
Don’t wait for everyone to get there first
Toyota’s sometimes fanatical push to make hydrogen the fuel of the masses puts it ahead of all other automakers in this barely existing space. While getting there first does not guarantee success, being first certainly makes success easier. This is a good time for other companies to get a share of the hydrogen car market. Competition is almost non-existent. If hydrogen succeeds, Ford and GM will end up playing a sad game of catch-up rather than triumphantly reaping profits.
American car companies seem to forget how pathetic it is when they try to catch up with the Japanese. Some readers may remember the fuel crisis of the 1970s that killed off all American land yachting. Faced with high fuel costs, American consumers snapped up Camrys, Corollas, Civics and Accords. The American auto industry was embarrassingly unprepared for a public that was demanding cars that used less than a tank of gas a day, and was quick to release dismal, annoying four-wheeled calamities like the Chevette, Dodge Aspen, and the more famous Ford Pinto. .
History would repeat itself as we entered the 1980s (although companies’ willingness to go bankrupt declined), when sports cars transformed from big-engined American monsters to smarter speedsters that came from across the Pacific. While the Big Three handled the switch to sports cars better than the fuel crisis, there were a few tough years before Ford and GM could catch up with Toyota, Nissan and Honda. Hydrogen cars are still a new field. The opportunity is here for Ford and GM to be leaders. But in more general terms than hydrogen cars, major US automakers could follow Toyota’s example by making cars that are a little ahead of their time (and this is where US companies stumble). Stick to them Instead of discontinuing it after one or two years of model year.
Currently, hydrogen is expected to get a major boost in the form of an EU mandate to establish a hydrogen fueling network in all member countries. Toyota already has a hydrogen-powered car in production that has proven reliable over a decade. The company is ready for the time when an entire continent of drivers gets easy access to hydrogen. But then again, neither are Ford and GM.
The future of electric vehicles is uncertain, so don’t bet on any one technology
While it is increasingly clear that electric cars will replace engines, they remain relatively rare on the roads. In a way, it feels like the turn of the 20th century, when the first cars started whistling on the roads next to horse carriages. The future may be a few decades away, but it is on the horizon nonetheless. Battery electric vehicles are currently the dominant form of electric vehicles. However, they could have gone the way of steam-powered cars (which were a respectable competitor to gasoline in the early days).
Profitable sales of American SUVs show that Ford and GM are very good at sticking to what works. However, both companies stumble when planning for the future. Neither company had rolled out a serious electric car until Tesla made it a success, a misstep that helped keep them in perpetual second place. Now, as hydrogen hovers in ever-shrinking distance, major American auto companies are preparing to make their favorite mistakes again.
