Cost To Develop Fuel Cell Cars Falls

The hydrogen refueling infrastructure may not be ready, but the cost of developing the fuel cell cars Toyota plans to launch in 2015 has plunged. Toyota's current fleet of Highlander-based vehicles, which were placed in university and utility fleets beginning in 2002, cost about $1 million a piece to develop. The new generation vehicles cost about $50,000, said Chris Hostetter, Head of Strategic Planning for Toyota Motor Sales U.S.A. That should put the sticker price of the vehicles under $100,000, Hostetter said at the Fortune Brainstorm Green Conference.

Honda has said its hand-built FCX Clarity fuel cell vehicle, which has been available as a consumer lease since 2008, costs nearly $1 million per unit to produce. But Honda also is working at driving down costs with economies of scale and advances in technology.

Toyota's 2015 production vehicle will have a Prius-like silhouette and size, similar to that of the FCV-R concept hatchback unveiled at the 2011 Tokyo Motor Show, Hostetter said. An updated version of the FCV-R will be shown at the 2013 Tokyo show. Toyota's 100 current Highlander-based prototypes have a range of 440 miles.

Toyota aims to sell fuel cell vehicles in states covered by the California Air Resources Board mandate. Other states affected include Arizona, Connecticut, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, and Vermont.

But for now fuel cell vehicles can effectively be sold only in California and New York, the two states in which refueling stations are available. That would put likely sales volume at about 2,000 annually. And slow development of refueling stations in those states could derail even that target. California originally planned to have about 60 hydrogen stations statewide, but the target has dropped to fewer than half that number and only eight are currently in operation, Hostetter said. New York is the only state on the East Coast with a feasible hydrogen infrastructure.

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