Toyota Kills Tiny Two-Seat Electric Car It Doesn't Believe In

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2009 Toyota FT-EV II

2009 Toyota FT-EV II

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We've been subjected to a spate of dire headlines today covering Toyota's statement that it's killing plans for its eQ two-seat urban electric-car program.

Reuters reported, "Toyota drops plans for widespread sales of electric car," which is at least an accurate headline.

Some seem to take a "sky is falling" tone, which we don't feel is the case.

Most of the stories focus on Toyota management's view that battery technology isn't ready, the market for pure electrics isn't there, and hybrids are a much better bet.

Those are all debatable points, but as Reuters gently points out, Toyota has always "taken a more conservative view of the market for battery-powered cars" than Nissan, General Motors, and other companies.

Another way of saying that might be to note that Toyota bet the company's future technology direction on parallel hybrids almost 20 years ago, and has reaped the benefits of what was likely a very expensive R&D program.

Toyota has sold well over half of all the hybrids on the planet, and its 50-mpg Prius Liftback is the most fuel-efficient gasoline car sold in the U.S. market that doesn't have a plug.

But as any auto journalist will confirm, Toyota executives and engineers relentlessly argue that parallel hybrids are the best way to meet the broad array of consumer needs.

They also frequently contend that plugging into the grid often isn't as ecologically sounds as it seems. (That's a whole different article we won't get into here.)

Toyota has worked on its own electric-car batteries for quite some time, but it hasn't had very good luck thus far.

The company admitted in 2010 that it had bet on the wrong lithium-ion cell chemistry, ending up turning to an outside cell supplier for the lithium-ion battery pack of its 2012 Prius Plug-In Hybrid.

And its first and only battery-electric vehicle was to be the eQ, an electric version of the tiny Scion iQ two-seat urban car. The company showed several prototypes of the car as the FT-EV and FT-EV II in 2009, and FT-EV III last year.

A two-seater with a projected range of no more than 50 or 60 miles: Does that sound like a winning electric-car strategy to you?

Toyota is left with just one all-electric car, the 2012 Toyota RAV4 EV, whose powertrain is entirely designed by Tesla Motors.

2011 Toyota FT-EV III Concept

2011 Toyota FT-EV III Concept

Enlarge Photo

That was quite an impressive car to drive, but it's strictly a "compliance car" to let the company meet zero-emission vehicle requirements imposed by the powerful California Air Resources Board.

So now Toyota will sell just 2,600 RAV4 EVs over three years, and only 100 eQs.

Not the sign of a company that believes in battery electric vehicles, for sure.

But Toyota has never believed in battery-electric vehicles, and it's been unable to develop one--unlike Nissan, General Motors, Ford, and others.

The sales of plug-in cars, while likely to double this year, have undoubtedly been slower than the most optimistic projections.

But frankly, Toyota canceling its battery-electric car program is roughly akin to General Motors deciding not to offer a plug-in Two-Mode Hybrid system in the Cadillac SRX because it didn't perform well enough.

Few people knew either car was coming, and not a lot of people would have cared if it did.

We think the eQ wouldn't have been an appealing car in the U.S., even to electric-car fans. In that light, we think Toyota made a smart decision.

It's just not the end of the world we seem to be reading about.


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Comments (10)
  1. "we think Toyota made a smart decision." where the word "smart" is hyperlinked to the SMART car company which could lend an unintentional subtle twist to that sentence.

    But yes, the eQ will not be missed. Frankly, I am not sure we would miss the iQ either.

  2. "Most of the stories focus on Toyota management's view that battery technology isn't ready, the market for pure electrics isn't there, and hybrids are a much better bet."

    It is all about "money". Toyota has invested heavily in its hybrid technology (IMHO, it is outdated and cheap). Now it is ready to expand that hybrid drive train into all Toyota cars. Why would it expand into EVs? It doesn't make financial sense for Toyota.

    Its investment in Tesla is there to keep a tab on technology and when it is "profitable", it will just take the Tesla technology and use it in their cars...

    Toyota will NEVER fully embrace EV until it "milks" every drop of profit out of its hybrid investment.

  3. Certainly Toyota is not the only company taking a "wait and see" approach to EVs. Only time will tell if it was a wise choice to wait or not.

  4. The practicality of a small 4-seat EV will suit a larger audience than a tiny 2-seat EV given the expected marginal cost differences. It's likely a wise move for Toyota given the financial situation in Japan. Sad there is no other EV offering in addition to the RAV4. Hopefully with demand, Toyota will extend it's RAV4 EV production run (beyond California).

  5. Even the RAV4 is really a Tesla design, NOT a true Toyota effort...

  6. @Xiaolong: To add a little more color, the powertrain was designed by Tesla and a joint Tesla-Toyota team integrated it into the vehicle. I suspect it was hard on both sets of employees [chuckle], who come from very, very different corporate and engineering philosophies.

    But I also think that in the end, both sides learned from each other. That's from extensive talks to engineering managers and execs at each company at the RAV4 EV intro event.

  7. Sure, I would imagine the amount of work go into "manufacturing, support, service and marketing" strategy.

    Toyota will never fully embrace EV until it can clearly see that EVs are taking off AND there is significant amount of money that Toyota can make from it. It chooses NOT to be leader in that segament like it did with Prius in Hybrid market. (Can't blame Toyota since it is SO INVESTED in hybrids such as Prius). Toyota has enough cash, manufacturing capacity and customer base to easily switch to EV if it chooses...

  8. What is with this continued expectation that EV's have to be inferior to gas powered cars? Maybe Tesla has showed the rest of the auto-making world that the American consumer and even the European and Asian consumers are not going to accept tiny worthless impractical and UGLY cars. If a gasoline version of this car would fail what makes Toyota think an EV version would succeed? I glad they came to their senses and squashed this pathetic vehicle. People want EV’s that are just as good or better than Gasoline powered cars. Impractical and Ugly does not sell.

  9. Tesla has shown the idea is sound. Now they just have to get their supply chain under control. No one wants a cheap tiny POS for a car, and why are the big automakers dead set on making ugly nasty little econoboxes into EV's? I will not buy one gas or electric.

  10. I thought collaborating with BMW or Tesla would have made this possible.

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