Toyota strikes major lithium deal
All plug-in ducks in a rowToyota, via one of its partners, has joined forces with Orocobre Ltd to mine lithium in Argentina according to reports.
Aside from securing a supply of lithium, Toyota is now positioned for greater profit potential in the sale of plug-in vehicles. As it did with its current hybrid cars, Toyota is now laying the foundation for its own supply chain of essential materials for battery-powered vehicles. By keeping a significant percent of its supply chains and battery development in-house, Toyota has been able to foresee profits in battery-powered vehicles where others have not.
Now the hybrid king appears on a path to also become the plug-in hybrid king.
Labels: Hybrid Vehicles, lithium battery, plug-in hybrid vehicles, toyota
posted by Dahcredyns at
8:15 AM
8 Comments:
It is the continuing reports of deals like these that gives me optimism.....
The auto manufacturers are developing strategies and positioning themselves for the future.........
a future that includes hybrids and EV's.......
it also gives me hope, at least for toyota. toyota is approaching lithium exactly the way they approached nickel.
outside of china, i'm not sure anyone will be able to compete with toyota on battery technologies, at least until such vehicles are thoroughly mainstreamed.
toyota, via its financial partnerships, will own a piece of the entire life cycle of plug-in production from the lithium to the cell to the battery, etc.
only byd, as far as i know, is so embedded.
Well, don't count out GM/Ford, because developing the supply chain is exactly the kind of investments that the Federal Gov't can make. I would assume that the Japanese government is playing a role in facilitating these deals for Toyota. The US government can also work to put together the same kind of consortia and partnerships.
This is more than just Toyota vs Detroit, is Japan vs China vs US vs Europe. For the US to lose out, when they have a program the quality of the Volt to give them a foot in the door would be a complete failure of our national economic policy.
that might be true, alcatholic, but this advantages Toyota much more than Honda. so, is the government only helping toyota? (nonetheless, i'd be in favor of the US government becoming more proactive on this issue in any number of ways.)
still, Toyota did the same thing with NiMH. this is their MO.
toyota owns a piece of everything from the raw lithium to the battery assembly plant. toyota understands this is the key to battery vehicle viability.
in my opinion, the US is in serious trouble on battery technology. ironically, as you allude to, i'm far more worried about China than I am Toyota.
BYD, for instance, OWNS everything from the ground up. That's going to be very hard to compete with in the interim to wide scale plug-in adoption.
Yes, but the Japan govt helped with NiMH as well. I think this is Japan's MO. Honda's participation or lack thereof was probably their choice, but I would assume the gov't would have helped them, and I think the govt is helping them in their renewed push with the Insight and future hybrids.
The way I see it, gov't support and investment through industrial policy is a fact of life around the world. From my understanding, the fact that the US gov't invested in exporting manufacturing to Mexico and China in order to enhance corporate profits at the expense of working class employment and wages is the tragic anomaly.
I can't say for sure that my notions about industrial policy are correct, but it is the prism through which I think about these things. Open to other ideas.
its the job of every government to facilitate pro-growth industrial policy.
my point is that toyota is doing something others are not, including japanese competitors. while toyota is assuredly receiving government help on many levels, toyota still has its own corporate policy.
when it comes to hybrids, toyota took a distinct, unique path, a very proactive forward thinking path that can (and could when designed) theoreticaly extend all the way to fuel cell hybrids, plug-in hybrids and pure EVs.
on the other hand, for instance, for years ford complained of limited nimh hybrid battery supplies.
why did toyota have supplies and ford did not?
because toyota sucked up all the resources for cost-effective nimh production before any other automaker even contemplated serious nimh hybrid production.
here again, toyota is acting fast. thinking ahead of the market rather than just following and reacting to the market. and when it comes to commodities, timing is usually everything.
you've read the studies on plug-in adoption. everything essentially boils down to the cost of the batteries (although unique business models could be the ultimate difference maker).
while improvements in manufacturing will decrease costs by as much as 50 - 65 percent, there is a threshold that is limited by the value of the commodities needed for battery production. these costs are well known and understood via decades of data.
toyota has demonstrated that it has understood this fundamental issue for probably a decade already when it comes to battery production and development. consequently, toyota's plug-ins are going to be built with toyota owned lithium.
with tight margins, that alone could be the difference between profitability and losses on battery powered vehicles.
You're exactly right, as far as I can understand. In fact, my only point is that Toyota's approach is so obviously optimal that I expect GM/Ford and the US government to do the same things.
They are behind, but if they are serious, and I think they are, they will follow the same path. The Volt program is an excellent foundation to build upon, in terms of a Lithium supply chain.
I hope you're right.
I've heard GM touch on the topic of cell development, but for the next several years, minimally, battery pack assembly is all that's happening. Same with Ford last I read.
That's pretty far up the food chain in battery development. The bulk of profits are probably to be found in cell production, lithium and other rare earth metal procurement.
Toyota is already fully on top of this game and already procuring resources for plans that span at least a decade down the road.
Thus, even if GM and Ford copy Toyota's approach today, they still have a lot of catching up to do, or maybe they are just hoping suppliers will do a good enough job.
Maybe. Maybe not.
In the short term, however, I bet it means Toyota can sell their hybrids and plug-ins a good bit cheaper than Ford and GM.
If gas prices stay relatively cheap, then this strategy might work out OK because interest in such vehicles will remain tempered. If not, Toyota is going to clean up.
And, hitting back to an earlier point, Chinese companies have an even greater advantage than Toyota in terms of owning their entire supply chain from the ground up. Then add cheap labor, etc. That's scary, especially as Chinese auto consumers become the key driver of the world's auto indsutry.
I want the US auto industry to excel, but I still don't think they are thinking aggressively enough into the future. That's where I'd like to see the government act.
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