Navigant Research Blog

Toyota Reveals Fourth-Generation Prius, Sticks with NiMH

— September 25, 2015

Toyota did not invent the idea of a hybrid electric vehicle (HEV)—that honor goes to Ferdinand Porsche with one of his earliest creations at the turn of the 20th century. Toyota did not even invent the modern power-split HEV architecture—that being a concept developed and patented by engineers at TRW in the late-1960s. However, like Apple, which has taken ideas such as graphical interfaces, mp3 players, and smartphones and then refined them into viable consumer products, Toyota was ahead of its time with the 1997 debut of the Prius. After recently selling its 8 millionth HEV, Toyota has just revealed the fourth-generation of the groundbreaking original hybrid, and hopes it will spur renewed popularity for the concept.

Toyota has done an admirable job of leveraging electronics, motors, controls, and battery technologies developed for the Prius across its lineup, from the subcompact Prius C to the luxury Lexus LS600h sedan. Much of that technology is also being applied to fuel cell and battery electric vehicles, helping to bring down the costs of those powertrains.

NiMH Batteries

Building on that heritage is also part of this new Prius, as Toyota continues to be the last major automaker to use nickel-metal hydride (NiMH) batteries while others have switched to lithium ion (Li-ion). According to Navigant Research’s Automotive Fuel Efficiency Technologies report, hybrids are expected to account for about 10% of the North American market and more than 30% of the Western European market by 2024, as manufacturers try to meet new efficiency and emissions standards. To do so, they will have to drive down costs to make the technology palatable to consumers.

Over the past 2 decades, Toyota and its joint venture partner Panasonic have made large investments in production capacity for NiMH batteries and likely have the lowest costs in the industry at this point. Toyota’s continued use of NiMH batteries for the mainstream Prius and the just launched Lexus RX450h, reserving Li-ion for the even more efficient Prius Eco model and the upcoming plug-in hybrid electric vehicle (PHEV), is one example of how Toyota is able to sell more of the most efficient vehicles than any other manufacturer.

Despite continuing with what many consider outdated battery technology, Toyota claims to have improved the energy density of its cells. Along with an internal combustion engine that is now claimed to have thermal efficiency of more than 40%, and lighter, more efficient hybrid system components, Toyota is projecting a 10% overall efficiency improvement for the mainline Prius (approximately 55 mpg combined). It has not yet revealed details about the Prius Eco, but media reports suggest it may achieve 60 mpg combined.

Looking Forward

The 2.4-inch longer Prius retains its now iconic egg-shaped profile while blending in some more dramatic design cues from the fuel-cell-powered Mirai. Toyota’s New Global Architecture (TNGA) provides the Prius with a new double-wishbone rear suspension that should help improve its traditionally uninspiring driving dynamics. After announcing in 2014 that it would deploy active safety features across its lineup, the Prius is now available with the Toyota Safety Sense package that includes automated pre-collision braking, pedestrian detection, lane departure alert with steering assist, adaptive cruise control, and automatic high beams.

Through August 2015, HEVs have only accounted for 2.3% of U.S. sales, with plug-in vehicles grabbing another 0.63% and the electrified vehicle segment with less than 3%. If automakers are to achieve future emissions and efficiency targets, they need to follow Toyota’s lead with the new Prius and combine increased efficiency with a broader value proposition to attract customers.


Automotive Mapping: A New Digital World

— September 15, 2015


German automakers Audi, BMW, and Daimler have announced plans to acquire Nokia’s mapping service HERE in a move that seems part of the continued blending of the automotive and digital worlds. HERE is one of a handful of companies that supplies mapping data to a wide range of end users, competing with Google Maps and TomTom. HERE’s strengths lie in the automotive sector, as its service is the most often used in vehicle navigation systems.

It may be that the automakers simply want to secure the availability of this mapping service to ensure that Google Maps won’t be the only game in town. The same could be said for another interested party in the HERE sale: Uber, which has recently acquired mapping expertise and intellectual property from Microsoft. This was seen as partly a defensive move. It appears that Uber is trying to position itself away from Google, which has been signaling through its investment through Google Ventures a desire to launch its own ride hailing app that could compete with Uber. But Uber has also expressed an interest in autonomous vehicle technologies, declaring to Tesla that it would be prepared to buy a fleet of autonomous electric vehicles. As Navigant Research has discussed, high-quality mapping is critical to the autonomous vehicle sector.

Meanwhile, Apple has continued to make moves that suggest it may launch an electric vehicle of its own. After reports in early 2015 hinted that the company was building an electric van, speculation have only increased when the company moved to hire a former quality control executive from Fiat Chrysler Automobiles and to use BMW’s i3 electric vehicles in a trial project.

Blurred Lines

This brings us back to the story of Audi, BMW, and Daimler acquiring HERE. All of these activities demonstrate that the digital and physical worlds are now fully integrated within auto manufacturing, and that the lines between these industries will continue to blur. Auto companies are now well-established in Silicon Valley, and it is apparent to the OEMs that they will have to be more than just car manufacturers in the future, but also mobility providers. German automakers are especially far along in this realization. BMW, for example, has its own smart parking app and carsharing business. Indeed, most automakers are exploring some of these new mobility concepts. Ford’s 25 global mobility experiments include vehicle sharing, carsharing, and smart parking services, while Toyota has its electric vehicle carsharing trial programs. Other OEMs are also launching carsharing services, developments that will be discussed in Navigant Research’s upcoming Carsharing Programs report.

Acquiring mapping expertise plays into the shift from automakers to total mobility providers. What will be interesting to watch is how daring the auto companies are prepared to be in making this transition. So far, much of the OEM activity is labeled as a trial, indicating that some OEMs are still unsure about the real value of these new services. Indeed, some of the services may well be low revenue generators, but they can help automakers stake out their role in the new urban mobility landscape. This is especially the case in the mature and highly regulated car markets of North America and Western Europe, where private cars will be just one more mobility tool among many.


Autonomous E-Bikes May Grow Ranks of Cycling Commuters

— September 3, 2015

Bikes_webBicycling safety seems to be gradually improving, as the number of people cycling to work in the United States is growing significantly while fatalities have remained relatively unchanged.

According to the latest American Community Survey executed by the Census Bureau, the number of workers who cycle to work grew from 488,000 in 2000 to about 786,000 in the years 2008–2012, for a 60.8% increase. Cycling as the primary means of transportation grew to 0.6%, while travel by private motor vehicle remained dominant at 86%.

Unsurprisingly, bicycling to work is most popular in larger cities, with Portland, Oregon retaining its spot at the top in the United States with 6.1% of all commutes done by bike. The United States trails bicycle commuting in Europe, where cities such as Hamburg are pushing to have 25% of all city trips completed by bike. The survey also found that men bike to work (0.8%) at more than twice the rate of women (0.3%).

Biking blog graphic

According to the National Highway Transportation Safety Administration (NHTSA), cycling deaths in crashes with motorized vehicles have been increasing over the past few years but haven’t kept pace with the increase in commuting. Approximately 743 cyclist fatalities occurred in 2013, which is up 1% from the year prior and is disappointing for safety advocates. Many cities are addressing safety by adding bike lanes and increasing outreach to drivers.

Electric Bicycles Keeping Pace

Electric bicycles (e-bikes) are expected to be part of the continued growth of cycling commuting trips. According to Navigant Research’s Electric Bicycles report, annual e-bike sales will grow by 76% between 2014 and 2023 to nearly 270,000 units in the United States. E-bikes can extend two-wheeled urban commuting beyond the current average of 19.3 minutes, as they can take over for weary legs on hills and aid cyclists to arrive more quickly than via pedal power alone.

An e-bike that could increase safety was premiered at August’s Eurobike conference by startup company coModule, as reported by Electrive. The Estonian company modified a Veleon electric cargo bike with autonomous driving features that can be remotely controlled via a mobile phone app. In addition to increasing the ability of cyclists to anticipate dangerous situations, the three-wheeled bikes could be used someday to deliver medical supplies to remote areas without the need for a driver.


We’re Asking the Wrong Question about Electrification

— September 1, 2015

At the recent Fleet Technology Expo in Long Beach, California, Tesla Motors’ co-founder and founder of Wrightspeed, Ian Wright, delivered a keynote to the gathering of fleet managers, suppliers, and consultants that turned the conventional wisdom of vehicle electrification on its ear. While mandates like the California Zero Emission Vehicle (ZEV) program and various federal and state tax incentives seek to displace millions of fossil fuel-burning vehicles with electric equivalents, Wright says we’re asking entirely the wrong question. Rather than asking how to maximize the efficiency of the mass of vehicles, Wright said we should be asking: “How do we save the most fuel per vehicle per year?”

On the surface, those might seem like the same question. However, when you actually start doing the math, the resulting answer is quite different. Vehicle emissions, including CO2, are directly related to how much fuel is consumed. Unfortunately, most people tend to think of efficiency in miles per gallon (mpg). When we plot fuel consumed versus mpg, the consumption curve asymptotically approaches zero as mileage goes up. In fact, the curve of incremental fuel savings flattens out dramatically at about 35–40 mpg. Beyond that, increasing mileage comes at a very high cost with little to actually show for it in terms of reductions in total energy use and emissions.

The big gains come when you start from very low mpg, where each incremental improvement yields much larger reductions in fuel consumption. That’s where Wright has focused his efforts in recent years. Wright joined Tesla co-founders Martin Eberhard and Marc Tarpenning and financial backer Elon Musk early on in 2003 to help the tech entrepreneurs with the technical aspects of actually building a car. While Wright left Tesla long before the Roadster finally went to customers in 2008, he continued working on electrification.

Different Solutions for Different Applications

Wrightspeed has developed a micro-turbine, range-extended powertrain system for medium and heavy duty trucks, the vehicles with the biggest potential for fuel savings because they use the most fuel. These big trucks typically only achieve 3–4 mpg running on diesel and even less on natural gas. While the Nissan LEAF or Chevrolet Volt can save individual owners hundreds of dollars a year in fuel compared to similar gasoline-fueled models, the actual amount of fuel saved is relatively small.

A refuse truck is an ideal application for hybridization since it operates at relatively low speeds and makes hundreds of stops and starts per day. In order to get the 130–150-mile range needed for its daily rounds, a fully electric version would need to carry so many batteries it would consume more than half its payload; however, a plug-in hybrid with 30 miles of electric range is entirely viable. Wrightspeed developed its geared traction drive, a 250 hp unit that integrates a traction motor, two-speed gearbox, and inverter, to provide propulsion and regenerative braking. In combination with a small 80 kW turbine range extender sized to run at its optimal efficiency, Wright claims the system delivers a 50% reduction in fuel consumption, saving $35,000 in fuel and $20,000 in maintenance per vehicle annually with a 3–4-year payback time.

Navigant Research’s Automotive Fuel Efficiency Technologies report projects that a wide variety of solutions will be required to meet future efficiency and emissions targets. In order to get the maximum overall benefit, we need to ask Wright’s question and pick the best solution for each application—not one solution for every application.


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