Honda, Citing Battery Limits, Avoids Rush to Plug-Ins

Masaaki Kato, president of Research and Development at Honda Motor Company, stands for a photo in the company's North American headquarters in Torrance, California, on Sept. 12, 2008. Photographer: Jonathan Alcorn/Bloomberg News

By Alan Ohnsman

Sept. 15 (Bloomberg) -- Honda Motor Co., first to lease hydrogen autos to U.S. drivers, said batteries haven't advanced enough to make rechargeable cars a good replacement for gasoline models and isn't following rivals who plan to sell plug-ins.

"For battery-powered vehicles to become more widespread, more popular in the market, we feel battery technology needs to advance further,'' said Masaaki Kato, president of Honda's research unit, in an interview at the Tokyo-based company's U.S. headquarters. Expectations for plug-ins are big and ``we don't know that that could be sustained right now,'' he said.

Honda is bucking an industry move toward lithium-ion batteries as record-high U.S. fuel prices this year and climate change concerns over carbon dioxide push carmakers to develop alternatives to gasoline power.

General Motors Corp. sparked interest in a new generation of electric cars with its Volt, a sedan due by 2010 that will travel 40 miles solely on lithium-ion batteries before needing a recharge. Toyota Motor Corp., Japan's largest automaker, and No. 3 Nissan Motor Co. are also readying small electric cars powered only by batteries.

A production version of GM's plug-in Volt is to be shown tomorrow in Detroit.

"GM and Toyota are slugging it out for attention as technology leaders in this area,'' said Phil Gott, a powertrain analyst for market forecaster Global Insight Inc. in Lexington, Massachusetts. "Honda doesn't want to get in the middle of that. They've also been fast to market with many technologies, and don't have anything to prove right now.''

'Impossible to Imagine'

Vehicles using lithium-ion power wouldn't satisfy most consumers, since such batteries are costly and still hold less than half the energy of gasoline by weight, Kato said.

"We just don't see it providing the type of driving performance you get with a gasoline-powered vehicle,'' Kato said Sept. 12 in Torrance, California, speaking through a translator.

For example, the Japanese government's advanced battery development program has a goal of boosting energy storage capacity by seven times and cutting cost to 2.5 percent of the current level, said Kato, who is also senior managing director for Japan's second-largest automaker.

"That gives you a pretty clear example of what type of gap we're facing relative to a gasoline vehicle,'' he said. "At this point, I'd say it's impossible to imagine a date at which such a breakthrough could occur.''

Refining Fuel-Cell System

While Honda may offer a plug-in at some point, for now it will continue refining the fuel-cell system in its new hydrogen- powered FCX Clarity sedan, Kato said. Based on advances the company has made with the vehicle, including improving range to 280 miles, ``we believe it's easier than battery innovation,'' Kato said.

Such a choice isn't unusual for Honda, said Michael Omotoso, powertrain analyst for market-research firm J.D. Power & Associates in Troy, Michigan.

"This fits in with their reputation for conservative product decisions,'' Omotoso said. ``They opted not to offer V-8 engines and stayed out of big trucks, and they're doing well this year because they focused more on small cars.''

Source:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a1gUi10kXBsM

The smart money is on Honda

Jeremy Cato, September 10, 2008 at 11:01 AM EDT

Honda or General Motors? When it comes to hybrids, who's got it right?

I'm leaning to Honda's simple approach over GM's attempt at a moonshot.

Here's the background. On Monday, unauthorized photos of the Chevrolet Volt, GM's plug-in hybrid, were leaked to the Web. Among other places they popped up on http://www.thecarconnection.com/. GM officials say they had planned to release the photos themselves later this month to coincide with the company's centennial celebrations next month.

Production of the Volt is due to start in November of 2010. If GM pulls this off it will be an amazing technological achievement.

That's because the Volt is really an electric car with a range of about 56 km. It will have a lithium ion battery pack and a small on-board gasoline engine. GM expects owners mostly to re-charge using a wall outlet, but if you get stuck you'll be able to charge up the batteries using the on-board gas motor.

GM actually does not call the Volt a hybrid at all. It is, instead, an “extended range electric vehicle.”

No auto maker has ever managed what GM is attempting. Most troubling of all is the fact the batteries are unproven. GM insists it has all the problems licked and that running prototypes are already being tested. We'll probably see one next week in Detroit at the company's centennial celebration in Detroit.

Even if GM manages to overcome all the technological hurdles, there is the little matter of price. Most believe – me among them – that the Volt will sell for something approaching $35,000 or $40,000. Why? All the new gizmos and gadgets for one. For another, GM will be selling Volts in very small numbers – at least at the outset.

I give GM full marks for being daring, but frankly Honda's approach is less risky and more likely to work as a profitable business.

I am talking about the Insight hybrid Honda showed last week. It is a smallish five-door hatchback due to go on sale next April and it we are led to believe it will sell for about $20,000, perhaps less. The Insight is smaller than the current Civic Hybrid which lists for just under $27,000.

Honda expects to sell 200,000 Insights a year worldwide. Moreover, this Insight is the first of several more hybrids from Honda. A smaller sports hybrid, the CR-Z, will come next and there is talk that around 2012 a hybrid Fit will be added. In each case, Honda will be using hybrid technology that the company has been refining for a decade, since the first two-door Insight hybrid went on sale.

Honda just keeps grinding away at overcoming the technological hurdles, rather than trying to manage a fantastic breakthrough. On top of that, Honda's very clear and oft-stated strategy is to put hybrid systems into compacts and subcompacts because that's where the green technology achieves its greatest efficiencies.

Unlike Toyota and GM, to name two, Honda has no interest in installing hybrid drive trains in luxury sedans and SUVs. And Honda research and development people say a pure electric vehicle, or something close to it, is not ready now and won't be for some time; the battery technology is not there and is not likely to be for many years – not in a reliable and affordable way, at least.

Honda's position here makes the most sense to me. I agree that hybrid systems are best used in small cars which are most often used for city driving – where stop-start technology saves fuel and cuts emissions and regenerative braking constantly recharges the batteries.

Oh, and I like Honda's recent track record overall. Remember, Honda reported a record profit of US $1.68 billion for the quarter that ended in June. GM and Ford, to name two, have lost billions this year.

Honda doesn't need a moonshot to be successful, but GM does. Put all the various factors together and it seems to me the smart money should be on Honda.

Source;
http://www.theglobeandmail.com/servlet/story/RTGAM.20080910.WBdriving20080910110140/WBStory/WBdriving