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Toyota backtracks, contemplates selling hybrid tech to competitors

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【Summary】Toyota looks to keep development and R&D costs down by selling its hybrid technology to its rivals.

Original Vineeth Joel Patel    Jan 01, 2017 10:15 AM PT
Toyota backtracks, contemplates selling hybrid tech to competitors

Toyota is widely regarded as one of the first automakers to emphasize fuel-efficient, earth-friendly vehicles with hybrid technology found in the original Prius. Since the original hybrid's release in 1997, the Japanese automaker has kept its hybrid technology close to its chest. More recently, Toyota has offered its hybrid components to Nissan for use in the Altima Hybrid, as well as to Mazda for the Japanese-only Mazda 3 hybrid. In a move to keep hybrids alive, Toyota recently announced plans to consider selling its hybrid technology to its rivals.

According to a report by Retuers, the move to offer its hybrid powertrains to competitors was formulated to boost the automaker's sales and expedite the rate at which the automotive industry is moving to cars that emit lower emissions.

The plan to sell its hybrid technology, which includes engines, transmissions, and other essential driving components, portrays how similar automakers' vehicles are. As Reuters points out, the automotive industry, as a whole, has moved towards cars that rely heavily on computerized components. With many automakers utilizing the same components, partnerships between automakers and major companies have become common.

Regulators are requiring automakers to create vehicles that are more fuel-efficient than ever, causing companies to spend a large amount of money on development and R&D for vehicles that don't necessarily attract sales. As Green Car Reports points out, the fourth-gen Prius was introduced last year, but hasn't sold well. Crossovers, cheap gas, and electric vehicles may have lent a hand at making hybrids a hard sell. Allowing its suppliers to create technology that can be used by more automakers would help hybrids live on.

"Toyota suppliers produce a lot of technology which can only be used by Toyota," stated Toshiyuki Mizushima, president of the automaker's powertrain company. "We want to change that…so they can make that technology available to non-Toyota customers."

With electric vehicles like the Tesla Model S leading the way for the future, automakers are being forced to research and create electric technology. And Toyota, which decided to pursue hybrids and hydrogen-powered cars, is lagging behind. Toyota currently offers a myriad of fuel-efficient vehicles in its lineup, eight of which are hybrids. The thing that's obviously missing from the automaker's cast is an electric vehicle, which Toyota skimmed over for the Mirai, one of the few cars in the world that runs on hydrogen.

Despite avidly opposing electric cars, even Toyota announced plans to enter the world of battery electric vehicles earlier this year. The plan has Toyota mass-producing battery-powered electric vehicles by 2020.

According to an earlier report from Nikkei Asian Review, Toyota saw the need for an entry-level electric car and planned to create an in-house group to develop the vehicle as early as next year. The plan, as pointed out by the report, was to create an electric vehicle capable of traveling up to 186 miles on a single charge. Developing its own batteries would be an expensive venture. So Toyota could reach out to another automaker or company to procure batteries, which is where selling its hybrid powertrain could come in handy.

Toyota's shift to enter the electric-vehicle market, after going all-in on hybrids and fuel cell vehicles, reveals how serious electric cars have become in a short amount of time. If Toyota doesn't get serious about electricity, it could fall too far behind.

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