November 15, 2017 1:15 pm JST

Toyota fuel cells: Next big thing or doomed to irrelevance?

Tech has a lot going for it, but plasma panels offer a cautionary tale

KUNIO SAIJO, Nikkei senior staff writer

A visitor looks at the underside components of a Toyota Mirai hydrogen fuel cell vehicle at an auto show in the U.S. © Reuters

TOKYO -- Despite the faster, sportier and cheaper electric vehicles that dominated the Tokyo Motor Show earlier this month, Toyota Motor is steadfast in its belief that fuel-cell vehicles should not be forgotten.

True, the hydrogen-powered fuel-cell vehicle has some clear benefits. But technological strengths and weaknesses are never fixed in place. The disaster of the plasma display offers a cautionary tale.

Down on the waterfront in the Hyogo Prefecture city of Amagasaki sits a six-story, windowless building the size of six good-size baseball stadiums. In November 2009, it began operations as Panasonic's third plasma panel plant. But despite the 210 billion yen ($1.83 billion) investment, the plant abruptly closed after just two years, a victim of the competition with liquid crystal displays.

LCD and plasma displays both have their advantages. Plasma, with its high image quality and ease of scaling up the panel size, seemed like the probable winner at the time, despite the higher cost. But South Korea's Samsung Electronics, Japan's Sharp and the world's major players made enormous investments in the cheaper LCD, and, one by one, overcame the plasma's advantages.

After fighting a lone battle, Panasonic eventually ceased production and closed the new Amagasaki plant.

Faster charging

Toyota has been developing fuel cell technology for over 20 years, investing a significant amount of money.

Both Toyota and Honda, which is also promoting its own fuel cell car, the Clarity, see a future where fuel cells, not batteries, could be the main power source for automobiles.

According to the Council for a Strategy for Hydrogen and Fuel Cells, which includes the Ministry of Economy, Trade and Industry and other entities, fuel-cell vehicles' benefits over electric vehicles are that the recharge time is significantly less, and the battery rarely degrades, no matter how much it is used.

Although these benefits hold true at the moment, the fuel cell vehicle's strengths may give way if the automotive and battery industries around the world start funneling more cash and effort into electric vehicles.

Tesla chief Elon Musk has called the technology of hydrogen-powered cars "incredibly dumb," due to its high costs.

The fuel-cell vehicle's main weakness -- the lack of hydrogen filling stations -- is unlikely to be overcome easily. According to Toyota's website, there are only 99 stations in Japan. In the southern Kyushu region, for instance, there are stations in only three of the seven prefectures.

Plan B

The number of towns and villages in Japan with few or no gasoline stations is increasing. Many gas station operators are considering shutting down their business, raising the specter of local residents having trouble finding fuel for their vehicles. Against such a backdrop, will there come a day when hydrogen stations, which cost several times as much as gas stations to set up, are built across the country?

That said, there are vehicles that would be ideal fuel cells. Large buses, trucks, forklifts and other industrial vehicles that need more power than conventional batteries are such examples. Because these vehicles often run on a predetermined route, only a limited number of hydrogen filling stations will be necessary.

For fuel-cell vehicles to avoid the same fate as plasma panels and ensure their survival into the future, companies and government ministries need to come together to formulate such a strategy.

Panasonic Corp.

Japan

Market(Ticker): TKS(6752)
Sector:
Industry:
Consumer Durables
Electronics/Appliances
Market cap(USD): 36,882.45M
Shares: 2,453.05M

Toyota Motor Corp.

Japan

Market(Ticker): TKS(7203)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 200,561.21M
Shares: 3,262.99M
Asia300

Samsung Electronics Co., Ltd.

South Korea

Market(Ticker): KRX(005930)
Sector:
Industry:
Electronic Technology
Telecommunications Equipment
Market cap(USD): 364,905.12M
Shares: 147.34M

Sharp Corp.

Japan

Market(Ticker): TKS(6753)
Sector:
Industry:
Consumer Durables
Electronics/Appliances
Market cap(USD): 15,489.32M
Shares: 499.45M

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