Honda reveals electric car plans

Better late than never, Honda reveals its electric car plans

Honda president Takanobu Ito announced at a news conference on 20th July 2010 that Honda will launch electric and plug-in hybrid models in Japan and the United States in 2012.

Honda, Japan’s number two car maker, has been luke-warm, to say the least, about electric vehicles (EVs) and plug-in hybrid vehicles (PHEVs), and has fallen behind Japanese rivals Toyota, Nissan and Mitsubishi, as well as European and American car makers, in the race to achieve ultra fuel-efficient cars.

Honda has also lagged behind in ‘full hybrids’. These are petrol-electric vehicles in which both the combustion engine and electric motor can be used either independently or integrated with each other. Compared with the ‘mild hybrid’ technology that Honda has preferred until now (in the Insight and CR-Z), full hybrids offer greater fuel economy and lower emissions – making them highly suitable for urban operation.

Honda is, however, a strong proponent of hydrogen fuel-cell cars in which a fuel cell stack combines hydrogen with oxygen to make electricity. The company’s hydrogen FCX Clarity is being tested in selected localities in Tokyo and California where hydrogen filling stations have been made available. But Honda has stated that it doesn’t expect to launch the car until 2020, when advances in technology and infrastructure have brought the price within the scope of its potential customers.

Honda to launch electric car and plug-in hybrids

At the news conference, Takanobu Ito said that Honda now plans to launch a compact electric car and mid- and large-sized plug-in hybrids capable of up to 140 miles per gallon of petrol. Details of the cars will be released at the end of 2010.

Ito’s announcement therefore signals a very significant change in the company’s product strategy. EVs and PHEVs have been key interests of Ito who headed Honda's research and development section before becoming chief executive in June 2009. In 2007, then-president Takeo Fukui said that plug-in hybrids offered too few environmental benefits to be worth pursuing. ‘Mr Fukui did not like batteries, but I am different,’ Ito said. ‘Now, as president, I have accelerated this process.’

At the news conference, Ito said the firm had ‘no future’ without making vehicles that emitted less carbon dioxide. He continued, ‘The next 10 years will be very critical for Honda to survive in the midst of major changes, at a time of increased environmental awareness and changes in the global economic structure. Coming up with good cars quickly and at affordable prices is now crucial to score success in changing times.’

Honda will expand its range of hybrid models in 2011, Ito said. The company will introduce the Fit hybrid in Japan in 2010 and the next-generation Civic hybrid in 2012. He also said the world's needs were shifting to small and green vehicles.

The launch of Honda’s EV and PHEV models is timed to meet tough regulations, including a new rule in California that will require 3% of a car maker's sales in the state to be zero-emission vehicles from 2012.

Honda’s new strategy fits the Japanese government’s aims to raise the share of mild and full hybrids from 10% at present to 20-30% by 2020 and to have EVs and PHEVs account for up to 20% of sales by then.

Honda already faces formidable competition

Honda’s EV and PHEVs are already facing tough opposition. The Mitsubishi electric i-MiEV is already on sale, the plug-in Toyota Prius will launch in 2011, Nissan will introduce its all-electric Leaf in Japan and America later in 2010 (Spring 2011 in Europe). Marketed as the world’s first affordable mid-sized electric family car, the Leaf has already taken orders in Japan that account for the first few months’ production.

The Renault-Nissan Alliance will then launch a range of small and medium sized EVs: the Twizy (urban runabout, 2012),  Zoe (city compact, 2012) and Fluence (five seater family, 2011) all of which, together with other American, European, Asian and Japanese planned electric and PHEV models represent formidable competition to Honda.

‘Last in, best dressed’

There is some consolation for Honda. The industry’s watch word, ‘Last in, best dressed’, may well ensure that Honda gets its cars absolutely right.