Verdict Is In: Toyota Deems Lithium-ion Too Pricey for Hybrids

Lithium-ion battery technology hit a major milestone this year when hybrid leader Toyota announced plans to test it in road trials of 500 plug-in hybrids — marking the first time this type of battery would be used for propulsion in a Toyota vehicle. While the automaker is going ahead with that plan for plug-ins, Toyota said today that after three years of testing, it’s decided lithium-ion battery technology still isn’t ready for prime time in the regular hybrid (without a plug) Prius.


Compared with nickel-metal hydride batteries, used roughly in 2 million Toyota hybrids sold since 1997, Kazuo Tojima, senior staff engineer for batteries at the company, told Bloomberg that the benefits of lithium-ion batteries — higher efficiency and less weight — just don’t outweigh the relatively high cost.

Toyota’s verdict on hybrid battery tech highlights two key points: the growing demand for lower-cost lithium-ion batteries (which many startups are targeting), as well as the need and opportunity for other battery technologies, which startups like PowerGenix are hoping to offer in coming years.

Hybrid vehicles are somewhat of an interim solution, with much of the auto industry, and the policies that influence it, moving toward plug-in hybrids and all-electric vehicles. According to Global Insight, hybrids are on track to snag some 5-11 percent of the U.S. market by 2015, up from 2.2 percent in just two years ago. So while lithium-ion is increasingly the tech of choice for upcoming electric vehicles, it’s hardly the only game in town.

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