Japanese leader in motor technology pours investment into environmentally friendly engineering. David Gow – The Guardian – March 31, 2006 Toyota has set out its vision for the future of motoring. It envisages accident-proof eco-cars, powered by a non-polluting engine that can clean the air around it, running on open roads free of congestion. The Japanese group is on course to become the world's biggest carmaker this year, and says its vision could become reality in 10-20 years. By 2050, the group envisages a recycling society: there would be no petrol stations, instead vehicles would run on hydrogen produced using renewable energy. Katsuaki Watanabe, its chief executive, said in an interview: "For us to become the genuine number one - in quality - we have to realise the dream vehicle, which makes the air cleaner, never injures people, makes people healthier and can run on a single tank of fuel between London and Istanbul." He wants to eliminate the environmental damage caused by cars and plan for the period when the world's reserves of oil and gas are expected to run out: around the middle of this century. Mr Watanabe and his board are investing 4%-5% of the group's global turnover of 18 trillion yen (£88bn) in hybrid vehicles, based not just on petrol but on diesel, biofuels such as ethanol and biomass, all-electric motors and fuel cells. "We are aiming at making a quantum leap in the next 10 years," said Shinichi Abe, head of Toyota's hybrid division. Studies by the firm's 21st Century Group of executives and experts foresee the number of vehicles on the roads increasing from 750m now to 1.2bn as the world's population surges to 8 billion, making the car industry's role in reducing emissions vital. Toyota researchers have already produced a series of concept cars, including the Fine-X, which runs on a hydrogen fuel-cell and can cover more than 300 miles at speeds up to 125mph. A few, earlier versions are being driven around Tokyo, where a handful of hydrogen stations to fill the on-board battery are available. Fuel-cell hybrid buses and trucks, under the group's Hino brand, are running in some cities. Mr Abe admits that the biggest problem with such vehicles is the sheer cost - not only of the vehicle and the fuel-cell, but the infrastructure required for the hydrogen economy as a whole. The problem of how to generate hydrogen and where to store or dispose of the resultant CO2 has also yet to be resolved. Hybrids have so far proved far more expensive than traditional cars but Toyota, which sold 300,000 of its Prius and Lexus RX hybrids last year, plans to sell more than 1m by around 2010. In Britain an initially slow take-up has accelerated, with 1,500 sold in the first three months of this year at prices starting from £17,760. Toyota is working on plans for "plug-ins" for the battery from the grid at fuel stations, with future hybrids carrying a traditional power-point for domestic appliances to be used outside the home. Mr Abe said the next Prius model will be able to do a nine-mile commute to work without using any petrol or diesel. Tokuichi Uranishi, head of overseas operations excluding China, said the group's environmental credentials had enabled it to outpace the growth of the US "big three" of General Motors, Ford and Chrysler, and boost its market share in the US to 13.3%, against GM's 24%. It has already overtaken Ford to become the world's second biggest carmaker and is expected to surpass General Motors this year to become the biggest. Its growth has come as its two US rivals flirt with Chapter 11 bankruptcy protection, sack a combined 60,000 employees and close 26 factories in north America. Toyota meanwhile has set a global sales target, including Lexus, Daihatsu and Hino, of 8.8m cars, compared with 8.1m in 2005, and its production goal is 9m compared with 8.2m. It made about $15bn (£8.6bn) operating income in 2004 compared with GM's loss of $8bn-$10bn in 2005 when it sold 9.1m cars. But Mr Watanabe is not complacent about the competition. "We have no plans to acquire a carmaker but new technologies are certain to emerge, like fuel-cells or other ones related to the environment, safety and information, and if there's any we don't have, even with our accelerated R&D and investment in-house, we might have to buy them in." He added: "There's a very good chance of others - the Americans, the Germans, the Koreans - overtaking us in terms of innovation and quality. In fuel-cells the US is ahead of us and the US and Germans could jointly develop hybrids better than ours. That's a sense of crisis I always have." Meanwhile, Toyota is using its considerable financial muscle and know-how to meet a precept of its founding father, Sakichi Toyoda: "Always be creative and studious, striving to be ahead of the others." Already, several of its Japanese models carry safety features which could soon be standard on European cars. These include devices to prevent whiplash and lateral skidding, which have cut accidents in Japan by 15%. The group is working on sensors, millimetre-wave radars and infra-red cameras that would, in combination with information panels installed at the roadside, warn the driver of dangers ahead such as a potential accident or, say, child. Ultimately, the car itself will take over and put on the brakes or decelerate to keep a safe distance. Masatami Takimoto, head of research, said of Mr Watanabe's dream: "Maybe the president was just trying to give us engineers homework, but engineers, by their nature, make tremendous efforts and I think it's not impossible to envisage the ultimate eco-vehicle on our roads ... We're even beginning to address the ageing process and thinking of the best personal mobility vehicle for the elderly ... We could break through in all these areas on our own, or with others." Mr Watanabe, whose target is a global market share of 15% early in the next decade, says the Toyota way marries brand leadership as an eco-friendly manufacturer with growing profitability. - A kind of Greenpeace geared to profits? one asks. He smiles serenely. Hybrids and hydrogen Carmakers across the globe are looking to make their cars more environmentally friendly. Fuel is a key area and attention is focused on three technologies: fuel cells, hybrids and biofuels. Hybrids work on the combination of an internal combustion engine and an electric motor. Conventional engines are inefficient when idling or at low loads. Using an electric motor improves that performance, after which the engine takes over. With a "regenerative braking" system the energy traditionally lost to heat in braking is used to charge the motor. For those who want acceleration rather than lower carbon dioxide emissions, the two can even be used together. For the moment hybrids are used on petrol engines though French car maker PSA is working on a diesel version. With fuel cells, the principle is to have hydrogen and air separated by a membrane through which the hydrogen can permeate. Add a platinum catalyst and you get a battery-like reaction which produces electricity, is more efficient in turning fuel into motive power and from which the only waste product is water. There are snags: the platinum is expensive, and then there is the question of getting the hydrogen. It must either be released from hydrocarbons, or extracted from water - a process that demands lots of electricity, produced, of course, mainly by burning hydrocarbons. Some companies are looking at fuel cells using a ceramic membrane, which operates at high temperature but there are problems with weight while the big temperature changes place demands on the membrane's ability to sustain expansion and contraction. At least one company is looking at using hydrogen in an internal combustion engine. That makes it more user friendly but it may not be as efficient, as it generates heat - ie, wasted energy. Biofuels such as ethanol or vegetable oils are not short of fans. They can be mixed with traditional fuel, the carbon they emit is balanced by the carbon captured during the growth of the crop used in the fuel. Industry insiders say there are high hopes for more sophisticated second-generation biofuels. Critics worry about the possible damage to the environment of farmers possibly uprooting rain forests to plant biofuel crops.