Pressing matters - Toyota wasn’t alone in receiving government assistance
The automotive press was abuzz earlier this month as corporations flung around statements related to the development of hybrid vehicles, suggesting Toyota may have received an unfair advantage by receiving government funding for research and development. However, Toyota isn’t the only automaker to receive government assistance. More than a decade ago, American tax dollars supported an auto industry initiative to develop a marked advance focused on developing a marketable, 80-mpg family car.
This conflict flared up recently after Business Week magazine published a quote from Jim Press, former president of Toyota’s U.S. division: “The Japanese government paid for 100 percent of the development of the battery and hybrid system that went into the Toyota Prius.” In September 2007, Press left Toyota to become Chrysler’s vice chairman and president.
While Press’s statement may not sound earth shaking, the news rocked Detroit. The impression left is that Toyota received an unfair advantage (i.e., government support), when some captains of the American car industry have long justified their delay, both on and off the record, in developing hybrids by claiming that such complex vehicles can’t make money due to huge development costs. They may be right. Even if the Japanese government did help pay for the development of the Prius, that doesn’t necessarily make it profitable. (Jim Press is shown here at the 2001 New York International Auto Show with first-generation Prius prepped for the transit authority.)
There is some dispute about the veracity or the details of Press’s claim. Toyota has refuted it. Chrysler has clarified the statements in a media-focused blog with “He said the Japanese government strongly supported R & D (research and development) investment in battery development, and the Prius and other Japanese models benefited from that investment in industry.” Yet, in testimony in 2007, Press told Congress that the Japanese government did not pay for any Prius research and development.
Whatever the truth may be, all the attention this story has generated may have left a false impression in readers’ minds. It implies that if only the U.S. government supported Detroit the way the Japanese government does Toyota, Detroit might not have lost the race to develop efficient, advanced hybrid cars.
A quick history lesson debunks this myth:
From 1993 to 2000, the United States did spend about $1.2 billion helping the American auto industry develop hybrids just like the Prius. The program was called the Partnership for a New Generation of Vehicles (PNGV). It was a joint effort between the Department of Energy, national laboratories, universities, and the Big 3 U.S. automakers (through a research consortium called USCAR). The goal was for each of the automakers to build a prototype family sedan that could achieve 80 mpg and cost no more than a similar conventional car.
Chrysler, Ford, and GM each produced prototypes that got at least 70 mpg: the Chrysler ESX3, Ford Prodigy, and General Motors Precept. All three were diesel-electric hybrids. But none of the companies have built such cars, as the original program mandate had envisioned, after PNGV was replaced by the fuel-cell focused FreedomCAR initiative in 2003.
According to a 2002 article in Issues magazine by Daniel Sperling, founding director of the Institute of Transportation Studies at the University of California at Davis and a member of the California’s Air Resources Board (commonly known as CARB), the PNGV had one other lasting effect: The prospect of the world’s richest country teaming with some of the world’s (then) largest automakers spurred Japan and Europe to develop similar task forces: the European Car of Tomorrow Task Force and the Japan Clean Air Program.
And unlike the U.S. companies, the fruits of Toyota’s participation in those efforts are visible on our roads every day.
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