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2010 Honda Insight – Click above for high-res image gallery

If a certain type of car struggles to gain a foothold in the market, what can be done? Let's use the hybrid as an example. Say you want hybrids to become a sales success, but it's just not happening. What are your options? You could ditch them because buyers don't want hybrids. Or you could offer up huge incentives to drive up sales for a brief time while losing money. Or the government could step in with mandates, credits and all types of different actions to almost force people to buy them.

Over in Japan, the Ministry of Economy, Trade and Industry (METI) issued new goals for hybrid and electric vehicles (EVs) domestic sales and the numbers are quite ridiculous. The METI wants these advanced vehicles to account for 50 percent of all new car sales by 2020 and that's no joke. Many industry experts don't believe that even 20 percent is obtainable by that time, so why set such an outrageous goal? Because METI is certain that its policies can help get the job done. How, you might ask? The group will spend whatever it takes, and plans to dish out some dough – starting with a $135.3 million payout for charging stations countrywide this year alone – in additional incentive programs, more on charging networks, and by coercing domestic makers to pursue advanced vehicles and promote the technology nationwide.

Guess which automaker is thrilled to hear this news about spending? Yep, you got it, Toyota. It will take METI to the bank on this one. The world's largest hybrid producer will reap a lot of rewards from the drive towards getting half of the market to be hybrids and EVs. For now, we're gonna call METI out on this one and say that 50 percent just ain't gonna happen by 2020.

[Source: Automotive News – sub. req.]


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  • 36 Comments
      • 5 Years Ago
      How did we get on Reagan? Was he Japanese?
        • 5 Years Ago
        There is a tie in. Reagan redirected the gov focus AWAY from renewable energy and real energy independence and TOWARD a fantasy of drill baby drill where the oil companies promised him they'd make us energy independent.

        Now the FCV fraudsters are trying to redirect efforts in Japan away from the true solution to oil dependence (electric cars and plug-in hybrids) and toward a fantasy that will also never happen, fuel cell vehicles that anyone could possibly afford.
      • 5 Years Ago
      hybrids already are the best selling vehicles in Japan and make up ~10% of the market... I think 50% is doable.

      Countries that anticipate future developments, actually set goals and make policy to reduce oil consumption generally have better progress than those that wait to react to market circumstances after they have already happened. It's the difference between leading and following.
        • 5 Years Ago
        Sure, but the teabaggers have declared President Reagan a SOCIALIST so letting out the fact that he was also a STOOGE of the oil companies is only fair.

        In the 1980s, the oil companies must have promised Reagan that if he just gave them all the free land they wanted for oil exploration they would make America energy independent. Well we all know that didn't happen. Go back and listen to Reagan's speeches. That is exactly what he stated. That we can become energy independent and that was one of his most important goals. Of course the oil companies had other plans (or they realized even before the drill bit hit the Alaskan tundra that they were lying about being able to get off foreign oil).

        So either Reagan was in collusion with the oil companies in perpetrating the greatest fraud against the American people or he was a tool, a stooge, of the oil companies. I'd rather think he was a fool than the world's greatest villain.

        /The fact is that Reagan was the one who removed the solar panels from the roof of the white house, who fought tooth and nail in congress to kill off Pres. Carter's energy independence proposals, to kill off "synthetic fuels," who gave the oil companies whatever they asked for, who removed environmental rules so oil companies could pollute wherever they wanted to practically. He took away every roadblock from the oil companies so they could drill baby drill. That was in the 1980s. Are we energy independent now? Hmmm. No, we are even MORE dependent on foreign sources (from about 35% then to nearly 70% today).

        Was Reagan a fool or criminal?
        • 5 Years Ago
        Not only that, but, they develop Local Industry to make those changes.
        Therefore, they benefit from the "Multiplier Effect".
        Every 10 new jobs may create 2 to 5 other new jobs.

        The problem with Reagan was, he wasn't a good enough Economist to be able to detect the BS Friedman was dumping. But, what if he was? Now, that's an Alternate Reality worth considering.

        Look at the massive Corporate Propaganda machine now in place. Even Reagan would have a hard time getting economic policy passed that would benefit America instead of China. The Oligarchy in America Wants China to Win. Just ask Rush.



      • 5 Years Ago
      "by coercing domestic makers to pursue advanced vehicles and promote the technology nationwide."
      @Eric, are you turning into an oil company shill here? Most US auto makers are too risk averse to make a serious push into electric vehicles and advanced hybrids. They fear that if they put billions into that effort one or more of their competitors will be able to undercut their prices on their other vehicle lines (which they would be able to do) and clean their clock in the ICE vehicle market.

      The rules must be clear and equal across the board. That is the only way to get anything done in corporate America. The recent economic collapse should be ample evidence to anyone that capitalism, when left completely alone without any regulation or direction, will destroy itself in just a few years. The auto companies are realizing that they NEED some direction, that they are unable to move away from the status quo by themselves. That is why they are ASKING the gov for tougher CAFE standards.
      harlanx6
      • 5 Years Ago
      That is an economic necessity for a country that imports all of their oil. In fact it should be considered by all oil importing countries just to stop the bleeding.
        • 5 Years Ago
        @harlanx6
        Japan already has the "kei" cars -- cars with 600cc engines or smaller -- that get substantial tax and insurance breaks. Japan is just doing the next logical step: Instead of just small, fuel-efficient "kei" cars, they're pushing alternative-energy vehicles as well. Great job, Japan! Keep it up!
        • 5 Years Ago
        @harlanx6
        I agree with you, and I think there's one more thing they are considering. The more they can push market penetration for hybrids/EV in their (protected) home market, the more they can improve the (global) competitiveness of their home industry in this fast-growing area. It's a smart long-term economic move on their part, and it's sure to pay off in the next decade. It gives them a perception and marketing edge too, being the 'greenest', when the real goal is more long-term economic in nature. Too bad 'long-term' in the US view is limited to the next election cycle...
      • 5 Years Ago
      Wow. Great goal. Imitate.
      • 5 Years Ago
      I know it's anathema to many ABG readers, but the Japanese are strongly supporting FCVs as part of their transition to a hydrogen economy. Toyota and Honda, as well as Nissan and Suzuki, are bound to be counting FCVs as part of their EV quota.

      http://www.meti.go.jp/english/topic/data/e20091111a.html

      http://www.meti.go.jp/english/report/downloadfiles/lowcarbon2009_02.pdf

        • 5 Years Ago
        Joeviocoe,
        You are correct about the needed battery back-up. Thanks for the information. It appears I was led astray by one particular design, which I can't even locate now!
        We must continue to differ on the cost of fuel cells, as you quote a price apparently off the shelf, whereas all the information that we have available from the companies involved indicates that at any level at which fc's would be produced for a production run of vehicles their estimated cost is already far, far lower than that which you quote:
        http://en.wikipedia.org/wiki/Fuel_cell

        Using the same methodology as that which you are using, no doubt the Nissan Leaf's batteries would be priced at a multiple of what they intend to sell them for in November.

        As for the infrastructure, the most developed plans are in Germany, where they are on course to make the use of hydrogen vehicles perfectly practical by 2015 as regards to infrastructure.
        As the time gets nearer Japan can doubtless make similar provision if the fc cars are panning out.
        • 5 Years Ago
        LTAW: An interesting assertion about them counting FCVs as EVs. Let's come back next year and see if that is true.

        I'd be happy to place a friendly wager they won't. :-)
        • 5 Years Ago
        Glad to hear it. That will give the struggling US carmakers GM, Chrysler, & Ford a chance to get ahead of the Japanese car-makers in EVs while they chase after the hydrogen unicorn.
        • 5 Years Ago
        I am not only talking "off the shelf"... but available to purchase NOW...

        I would agree that $3,000/KW is available "off the shelf" to be purchased by individuals such as myself... Just as I agree that I can buy LiFePO batteries for $450/kg from china myself.

        And I do agree with you that automakers costs for fuel cells are MUCH lower at $1,000 per KW. Making for only a $100,000 FCV.... a bargain to be sure... just as I agree that Nissan can make the Leaf batteries for less than $350 per kwh (at a volume of 50,000 per year).

        -------------------------------------

        The above was not based on projections or prediction, but what is currently happening.

        The whole hydrogen hype seems to be predicated on the projections of $61 / KW fuel cells (which in my opinion is lobbyist fueled optimism).

        And is based on a volume production of 500,000.... which in my opinion is not possible until AFTER somebody pays billions of dollars to develop a hydrogen fueling infrastructure... which nobody will do until several thousand FCVs are on the road.... which will not happen until fuel cells are cheap enough... so on and so forth.

        --------------------

        Li-ion batteries dropping from $1,000 /kwh down to $100 (10% of original costs) is feasible in my opinion (already 70% there)... but predicting that fuel cells will drop from $3,000 / KW to $61 (2% of original costs) seems ludicrous and just another lobbyists' snake oil.

        Remember,, an EV only needs about 24 kwh while a FCV needs about 80 kw.... so $/KW for FCV needs to be 3 times cheaper than $/kwh for EVs to equal in overall costs.

        Batteries are nearly at target (enough to start producing)... FCVs costs are still a pipe dream (as in "you need to be smoking something to believe it").
        • 5 Years Ago
        The Japanese government's website is filled with interesting little bits.

        Here's a vehicle tech roadmap for 2030:

        Battery, FC, clean diesel, biofuel are all listed.

        http://www.enecho.meti.go.jp/english/toprunnner/16english2008_pdf.pdf
        • 5 Years Ago
        ... from IMPORTED fossil fuels no less.
        • 5 Years Ago
        Well, I was way off on that one. You're right they are going to be counting pretty much everything they can...which actually makes sense. I was too focused on this one announcement about money they were spending on charging stations.

        Hey, I made the bet so I'll pay up. LTAW, David M. and Joe all responded so I'll buy lunch or dinner if we're at a car show or gathering of some type. And yes, I'm in London quite often so you can collect too David...assuming you're in the London area LOL

        Actually I may be in London next week.
        • 5 Years Ago
        The Japanese will certainly count FC vehicles as part of their hybrid/EV quota.
        Leaving aside esoteric debates about imports etc, Fuel cell vehicles are electric vehicles by definition.
        They also sport a minimum of around 10kwh of batteries, so have a lot more than most hybrids on that count too.
        My view has always been since you are carrying so much batteries anyway that you might as well make it a plug in hybrid anyway, so minimizing both the fuel cell size needed and hydrogen requirements.
        • 5 Years Ago
        "minimum of 10 kwh"

        No they don't. They need a minimum of 10 KW maybe. Power, not energy.

        FCVs need just as much battery as a mild hybrid... about 1.3 kwh of NiMH should do nicely.

        ----------

        But I do think FCVs will be counted in their definition of EV. As well it should be.

        The only problem they may run into is the definition of "new car sales". Unless METI counts "leases" of FCVs as "sales", Automakers cannot comply. The miracle hydrogen infrastructure is not built yet, and without that, Automakers cannot produce the massive volume needed to drive down Fuel Cell costs from $3,000 per KW ($300,000 per stack).

        And automakers are stuck because nobody can sell a FCV for a reasonable price. They can only lease one (keeping the asset).
        • 5 Years Ago
        Lets... Why would FCV count as a EV in Japan when they will be producing H2 from fossil fuels.
      • 5 Years Ago
      Yes we need a Reagan now. "It is morning in America, consume and pollute like it was 1895, consume now and help our economy, you can worry about any side effects later". I voted for Reagan. As a 18 year old I was extremely ingnorant and bought into his tripe.

      Short term glory, long term doom, that was the Reagan way. You can't keep doing the same thing and expect a different result as this is the definition of insanity. Take your solar panels and throw them away and put Americans to work building oil refineries and coal plants, yes we can still build more coal plants than China if we try and we can build them cheaper without all that pollution control crap. Excessive greed and deregulation is what we need. Don't regulate the bankers, Jamie Diamond CEO of Morgan/chase as already warned if you try to regulate us, small businesses credit will be cut off. Way to blackmail the economy Jamie your are a real patriot. Banks are incentivize to mismanage their corps and that is the way the 13 bankers that had both hands held out for money in the fall of 2008 want it. The banks are so big they don't even know what their employees are doing. For the big banks ignorance is all the excuse they need. Lobbying one million dollars a day is working they will not stop until they are entitled to bailouts. Studies have shown there is no benefits to society for banks being any bigger than 100 billion. Morgan/Chase is 2 trillion. Trust me, I am a banker!
        • 5 Years Ago
        Spec, Star Wars was the fictional stake that Reagan put through the Soviet Union. Reagan made it impossible for the Russians to match us in military spending and the Star Wars program was a bluff that worked as the Russian empire did not have a big enough GDP compared to us and thus could not support the spending for their military with out starving the Russian people. When the concept of Star Wars was introduced the Russians quit trying to compete with us in military power as they knew it was futile. As it was the Russians were nearly bankrupt trying to keep up with Reagan's military spending. I will give Reagan credit for breaking the Russians.

        Sorry Joeviocoe for the Reagan story.
        • 5 Years Ago
        EVsuperhero, I voted to re-elect Carter, against Reagan in the first election after I turned 18. We must be about the same age? I knew somehow in my gut that Reagan's smoke blowing would be the wrong move and Pres. Carter's plan to make us energy independent would be the right move to make. I just didn't know how right Carter was in 1979.

        If Reagan had never been elected we would have been free of mid-east oil by 1990, completely energy independent by 2000.

        Reagan instead took us from importing 30% of our oil to 70% today. Bright boy, wasn't he? In 100 years I believe historians will correctly view Reagan as either the greatest criminal in history or the greatest fool. His only achievement was to 'tear down that wall.'
        • 5 Years Ago
        I was in Engineering school when I heard Reagan give his peace shield (AKA SDI, AKA 'Star Wars') speech. I laughed and knew he was an idiot. At the time, I said "There is no way they will be able to build that thing in the next 25 years!" Well, the 25 years has past and they still can't build it. (Though, they have done some cool looking rigged demos.)

      • 5 Years Ago
      I've got no idea why the guy over at Automative News even thinks this is an ambitious goal.
      A lot depends on how 'hybrid' is defined, but the introduction of capacitor-based systems in Europe this year means that micro and mild hybrids can be done at a much smaller premium than for, say, the Prius.
      My guess, and the guess of people like the US DOE, Barclays, BOA and Goldman Sachs, is that oil prices will be around double by about 2015 and so the incentive will certainly be there.
      For electric cars the real bottle neck is lithium and lithium battery production, so hopefully the Japanese will put together a program perhaps similar to that of Korea to get lithium from seawater.
      Good for the Japanese in starting to put together a coherent strategy.
        • 5 Years Ago
        Exactly. Mild hybrid is a win, bigger hybrid is a bigger win. All the Japanese have to do is (correctly) portray any car that pollutes at a standstill as a primitive offensive anachronism. Some car buyers will revel in being throwbacks or won't be able to afford it, but the majority will happily get the feature.

        I hope the better fuel economy of mild hybrids shows up on the Japanese MPG cycle EPA.
        • 5 Years Ago
        It is my view that oil prices are likely to double by 2015, and double again by 2020, so I doubt that any extra impetus from fashion will be needed.
      • 5 Years Ago
      According to stuff I have been reading over at theoildrum.com, there are some folks (Oxford University, US DOD) who think that the energy reporting forecasting agencies (IEA, EIA, CERA) might be experiencing some fog in their crystal balls and hence overly optimistic in their oil production forecasts. These "pessimists" are guessing that world oil production could begin to decline as soon as 2012 or as late as 2015 at rates of at least 2% per year while, the real doomers are projecting that world net exports (the amount of oil that will be available to non oil producing countries like Japan) could fall by 10% per year or more.

      Looking at the best case of production decline starting in 2015 by 2% pa, the amount of oil available on the world market might only decline by less than 6% by 2020 and the Japanese targets look a bit optimistic. On the other hand, a worst case scenario of net exports declining by 10% pa starting in 2012 would have oil available to non producers dropping by over 50% by 2020, in which case I'm thinking sales of traditional vehicles will hit a brick wall. In other words, in a worst case future the Japanese METI goals might appear to have been ridiculously low.
      • 5 Years Ago
      I'm going to go out on a limb here and say that they can achieve it if they really want it and put in place the incentives for it. (High gas taxes, EV incentives, public charging infrastructure, EV parking perks, etc.) Between high gas prices and incentives, people will switch.
      • 5 Years Ago
      Reagan instead took us from importing 30% of our oil to 70% today. Bright boy, wasn't he? In 100 years I believe historians will correctly view Reagan as either the greatest criminal in history or the greatest fool. His only achievement was to 'tear down that wall.'

      LOL, because Carter was so great??? He was a complete laughingstock. No one in their right mind thinks that a president is great who lets American citizens be held in chains for 444 days.

      To say that Reagan kept us on oil misses the point of free markets. He didn't control them. Oil has been extremely historically cheap and no amount of government control would get the US on unproven solutions and technology that didn't exist (nice revisionism by the way). It barely does today...so you can't argue that we would have everything in place by 1990 (say). I don't think that science stopped or research stopped. Not at all, you could've put more money towards it but the basic research has been continuous. So sorry, I know that you don't believe in free markets but only when there are price signals does the market start finding alternatives-like um, today. You do know that prices are really information, right?
      • 5 Years Ago
      "The problem with Reagan was, he wasn't a good enough Economist to be able to detect the BS Friedman was dumping."

      Please highlight which principles in which Friedman books you're referring to. How many of them have read? Ummm.....

      Reagan's policies led to one of the greatest GDP growth curves in American history. It is simply a fact that lowered taxes and slowed government growth created a historical amount of jobs and new highs in government revenue. If you don't know this, then you haven't even looked at the numbers. Ignorance is telling.
        • 5 Years Ago
        "It is simply a fact that lowered taxes and slowed government growth created a historical amount of jobs and new highs in government revenue. If you don't know this, then you haven't even looked at the numbers. Ignorance is telling. "

        Interesting you should talk about looking at numbers. If my father went out and bought mom a new Mercedes, a huge house and a yacht...all on credit, then died and left us holding the bag and wondering why we lost everything and had to move to a trailer park, I wouldn't be hailing him as the greatest genius of all time.

        Why don't you take a look at numbers that show what happened to the deficit under Reagan and Bush Sr. :
        http://www.usgovernmentspending.com/downchart_gs.php?year=1960_2010&view=1&expand=&units=b&fy=fy11&chart=G0-fed&bar=0&stack=1&size=l&title=US%20Federal%20Deficit%20As%20Percent%20Of%20GDP&state=US&color=c&local=s

        Look at that time from 1980-1992 and notice which way the trend is going. Then look at what that trend started doing from 92-2000 under clinton. Then look at what it did under Bush Jr.

        I'm an independent who favors a strong military and grew up with "conservative/republican" values and fiscal ideas. But when I look at the actual results of all those policies over the long term....I have to be willing to think for myself what it means and look at the real results, not the talking points about big government destroying our economy. I still don't like big government, but I sure as hell can't look at the proof and claim that was the problem.
        • 5 Years Ago
        Why don't you take a look at numbers that show what happened to the deficit under Reagan and Bush Sr. :

        Look at that time from 1980-1992 and notice which way the trend is going. Then look at what that trend started doing from 92-2000 under clinton. Then look at what it did under Bush Jr.

        That's great Dave, I don't mean to embarrass you but it's clear you haven't examined the actual numbers. Say what you will about the slight increase in deficit under Reagan, but the GDP grew substantially more than the deficit through government spending. Do the math - seriously, and then come back.
        • 5 Years Ago
        I'm referring to Friedman's book:
        Free to Choose( FRAUD )

        I remember Reagan's tax cut, true there was growth from those high tax rates, which we do not have in place today.

        But, also Reagan's Massive Military buildup: Which was Keynesian Economics at it's best. Then there was Reagan using the government as a whipping boy. Where actually current events have shown us that Corporate Fraud is 1000's of Times More Damaging to the Economy, then government run programs. Which run cheaper and better then the private sector. But, private industry does produce VAST Wealth for a few CEO's.

        One good example was Katrina, where private industry ran Insane with FRAUD.
        Then there's Enron, and Worldcom, and Madoff, and......


        • 5 Years Ago
        Are you really that smug and pretentious or is it just coming across that way with no body language or context?

        Here is the same chart adjusted to show the increase of the deficit in terms of percent of GDP. So clearly the deficit grew more than the GDP during that period.

        You can have your opinion that the increase in deficit was worth the short term gain in jobs and I have my opinion that it was not. I feel that we went to far into debt and we have never really gotten out from under that debt in the same way that many households do.

        But either way, the numbers support what I said, that the deficit grew at a faster rate than GDP during the Reagan/Bush years.

        http://www.usgovernmentspending.com/downchart_gs.php?year=1960_2010&view=1&expand=&units=p&fy=fy11&chart=G0-fed&bar=0&stack=1&size=l&title=US%20Federal%20Deficit%20As%20Percent%20Of%20GDP&state=US&color=c&local=s
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