GM, Toyota Team Up to Develop Technologies
General Motors Corp. and Toyota Motor Corp. on Monday announced a five-year partnership to develop and possibly jointly produce advanced-technology vehicles, including those powered by fuel cells.
The collaboration is the most extensive research and development partnership independently undertaken by two major auto makers, surpassing the joint fuel-cell project by Ford Motor Co. and DaimlerChrysler.
The GM-Toyota partnership heats up the race to bring environmentally friendly vehicles--including battery-powered, hybrid and fuel-cell electric cars and trucks--to showrooms in large numbers after the turn of the century.
“This deal has the potential to define the future of the automobile,” said Harry Pearce, GM vice chairman, at a news conference in Detroit.
Said Jason Mark, transportation analyst for the Union of Concerned Scientists: “GM and Toyota are a real powerhouse. We are seeing an environmental arms race among the auto makers, with everyone trying to keep up with the competition.”
The partnership brings together the considerable research and development talent of GM, the world’s No. 1 auto maker, and Toyota, No. 3 worldwide. Together, they account for 25% of global auto production.
The companies declined to put a value on the program, but GM executives said they have spent more than $1 billion on advanced-technology vehicles since 1990.
GM and Toyota, which began talks on the partnership in June, said they have identified 12 projects on which they will collaborate, including fuel-cell and hybrid development. Several hundred engineers from both companies will be involved.
The program was unveiled just a day before Ford, DaimlerChrysler and Ballard Power Systems of Canada are to announce a partnership with three oil companies and the state of California to demonstrate a fleet of fuel-cell vehicles.
The GM-Toyota deal also comes during the week of Earth Day and as federal environmental officials are preparing to announce new pollution regulations that are expected to require auto makers to reduce tailpipe emissions further.
“They are trying to send a message to the regulators to leave them alone and they will do the right thing,” said Ann Mesnikoff of the Sierra Club’s Global Warming and Energy Program. “But history is not on their side.”
Meanwhile, GM and Toyota have a long working relationship. They have jointly produced vehicles at the New United Motor Manufacturing Inc. plant in Fremont in Northern California since 1984. Toyota also sells Chevrolet Cavaliers under its brand name in Japan, and the two companies have worked together on inductive charging systems for electric vehicles.
The auto makers said the impetus for joining hands was the high cost and risk inherent in developing untested new technologies to replace the venerable internal-combustion engine.
“When you have two big companies coming together, there is an acknowledgment that the risk and cost is great, but the potential rewards are also very high,” said David Cole, executive director of the University of Michigan’s Office for the Study of Automotive Transportation.
Both GM and Toyota have been at the forefront of advanced technology development. GM was the first to market with a new electric vehicle when it introduced the EV1 sports coupe in 1996. It is also working on several hybrid-electric concepts and has shown a methanol-based fuel-cell vehicle.
Toyota was the first auto maker to sell a gas-electric hybrid when it introduced the Prius subcompact in Japan in 1997; it plans to begin selling the Prius in the U.S. and Europe next year.
The Tokyo-based company also sells several battery-powered electrics, including a version of the RAV4 sport-utility vehicle in California, and is working on several fuel-cell concepts.
The joint venture will focus on four areas:
* Common electric motor and control components for future battery, hybrid and fuel-cell electric vehicles.
* Advanced batteries and improved fast-charging systems.
* New engines and control systems for hybrids.
* Fuel-cell vehicles, specifically in identifying the most suitable fuel as well as fuel processing and systems design.
GM and Toyota hinted that they will consider joint production of advanced vehicles in the future, though it is too early to speculate about a timetable or the models involved. It has been rumored that Toyota may build the Prius for the U.S. market at the NUMMI plant in Fremont, holding out the possibility that the car could be badged as a Chevrolet.
Pearce would not rule out re-badging a Toyota hybrid as a Chevy but said it is premature to discuss that possibility. Maryann Keller, an analyst with ING Baring Furman Selz, said the two companies are more likely to stick to sharing basic research and develop competitive autos independently.
“Companies can collaborate easily at the very basic research stage,” she said, “but it doesn’t make much sense to go beyond that.”
GM and Toyota stressed that it is still unclear what technology will most likely replace traditional gas and diesel engines but emphasized that future vehicles will have to match current ones in cost, comfort and ease of use.
“Without these elements, customers will not choose vehicles with advanced environmental technology,” said Akihiro Wada, Toyota executive vice president. “As a result, the technology will not proliferate and in turn can contribute almost nothing to the preservation of the Earth’s environment.”
While Ford and DaimlerChrysler are vowing to mass-produce as many as 40,000 fuel-cell vehicles a year beginning in 2004, GM and Toyota executives are more cautious.
“I think that would be a real stretch to put large numbers of fuel-cell vehicles in the hands of consumers that are affordable,” Pearce said.
