Former CEO of Ford and Chrysler, Lee Iacocca had a strategy to car innovation. The way Iacocca’s plan works is: a designer comes up with an exotic concept. If people like it, each generation of a car model would incorporate more and more elements of the concept until one day the latest generation looks like the concept that everyone liked. So that way when car buyers go to a showroom they see something familiar enough that they aren’t concerned if it will work or not. Cars are the second most expensive item that people will buy, after homes. Car buyers will always sway conservatively when buying a car because they want to know it will work. A car company can’t just come up with an exotic looking concept and expect people to buy it right away.
When Toyota unveiled the Plugin Prius I thought that Toyota would actually employ Iacocca’s strategy and phase out the gasoline engine over time and eventually sell an all electric Prius. That wasn’t the case though. The Plugin Prius had barely any EV range and it appeared was only thrown together to qualify for California's green HOV sticker. California no longer gives HOV stickers for hybrids, only plugins. The classic Prius no longer qualified for the carpool lane, a feature that was responsible for the sale of a lot of Priuses (Prii?). When the Mirai came out it was abundantly clear Toyota had no interest in creating a full battery electric vehicle let alone an all electric Prius.
This slow strategy to automobile electrification was what I had thought Toyota was doing with the Prius until the Mirai came out. When the Mirai came out it seemed to me that Toyota wasn’t interested in BEV (battery electric vehicles) at all. It appeared that the Plug-In Prius was just a compliance car that Toyota had thrown together so that it could qualify for California’s green HOV sticker. California only gives HOV stickers to plug-in vehicles now so the old reliable Prius no longer qualifies for the carpool lane. The Plug-In Prius seemed half-ass with barely enough range to really matter. But, still people bought it. Why? Because it’s Toyota and Toyota has the brand recognition of being a green car company.
Toyota should get back to the path of full battery electrification and they may be doing it with the Prius Prime. And they are almost there. They have three major hurdles to jump and they have already jumped two. Selling a hybrid car was the first major hurdle and they already surpassed that. The next hurdle is adding a charging socket and bigger battery. They did that, although how well remains to be seen. The Plugin Prius exists but it is by no means the rock star the Chevy Volt is. A final hurdle will be getting rid of the engine all together which will be a huge step. Between these hurdles the changes would be gradual, higher capacity batteries for larger electric range, more efficient engines for using less gas. If they do this right when they do reach that final hurdle and finally get rid of the engine it will be like losing the tape deck, nobody will miss it because no one was using it anyway.
Toyota of all car companies is poised to take this strategy because they have already established themselves as a green car company. When GM killed the EV1 Toyota went ahead and sold its RAV4 EVs to their leaseholders caving in to their demands. The old RAV4 EV can still be seen on the road from time to time. They did this because, at the time, they were unveiling the Prius and didn’t want to tarnish their image as a green car company. I commend them for bringing the Mirai to market but, I urge them to continue the path they started with the Prius and build an all-electric car. They can set themselves apart in the market that way. Instead of being revolutionary they can be evolutionary and capitalize on their long track record of green mobility. GM will always be haunted by the ghost of EV1, Tesla had to hit the ground running, Toyota can take its time and build on reliability.
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