CARB Rules Could Cost Toyota a Billion Bucks

Edward Niedermeyer
by Edward Niedermeyer
carb rules could cost toyota a billion bucks

California’s zero-emissions vehicle law could cost Toyota, darling of the environmental crowd, up to a billion dollars reports Bloomberg. That’s more than any other automaker is looking at. Why? Because by 2012, California will require that 3 percent of unit sales over a three-year period be zero-emissions models. Since Toyota has over 24 percent of the California car market (nearly double Honda, which is number two at 12.9 percent), it’s facing far stiffer requirements. And unlike Honda it doesn’t have a hydrogen fallback (although Honda’s FCX Clarity is not yet on sale). According to Bloomberg, Toyota will have to sell 16,000 plug-in hybrids (PHEVs) and EVs come 2012. “If you’re only discussing the cost of batteries and other components, a $1 billion cost for Toyota may be a stretch,” says Brett Smith of the Center For Automotive Research. “Add in all the things needed to support these vehicles — service, dealer training, marketing, warranties, new manufacturing equipment to get them into production, and [$1b] sounds reasonable” Toyota is declining comment on the exact cost of CARB compliance, but has already questioned whether PHEV demand will live up to enthusiast expectations.

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  • WetWilly WetWilly on Jun 04, 2009

    It'd be great if all the automakers would grow a pair and say "We can't meet CARB requirements so we're going to stop shipping new cars to California."

  • Refugee Refugee on Jun 04, 2009

    The money sink will be the BEV's. You have to sell pure ZEV's to comply, no matter how many PHEV's you sell. The Bloomberg article doesn't give the split, but it's there.

  • Kurt. Kurt. on Jun 05, 2009

    I agree with WetWilly but I'd go one further... I'd combine all my Kalifornia dealerships into two GREAT dealerships in Reno and Las Vegas. Advertise "GREAT Deals" for California ID holders in Kalifornia. This would accomplish a couple of things. STUPID Kalifornians would have to drive to Nevada to get a car. They might change their opinion of their legislature and vote in responsible representitives. CARB would go away. Oh, by the way...CARB is no more. Now it is the Air Resources Board (as in they want to take ove the country...not just Kalifornia.)

  • Joeaverage Joeaverage on Jun 05, 2009

    I'm sure the CA gov't would find a way to outlaw "imported" vehicles from Nevada. I could envision automakers selling plug-in cars at some reasonable price by raising the price of all their products by a few percent. Call it the cost of doing business in CA. Obviously CA is going to have to do something about the number of tailpipes pumping pollution into the air. I'm surprised they haven't done more faster than this. There are plenty of articles from 40-50 years ago complaining about the pollution. I'm also flabbergasted by the amount of BS that people will put up with to live in that mess. High prices, unemployment, crowded cities, crowded roads, gangs, the porous southern border, etc. Am surprised that CA hasn't begun taxing the heck out of their gasoline, taxing the bejesus out of vehicle registrations (except "green" cars), and reconstruction of the street car lines that GM and friends tore up in the 50s. CA is truly a preview of what Americans will put up with - pollution, immigration, taxes, COL, commutes, etc. They don't have to worry about me coming to live there or perhaps even visiting there. I'm anxious for them to put highway capable EVs back on the roads b/c EVs will be available to the rest of us sooner. I figure Toyota will just build another RAV4-EV if they need to. Perhaps with Lithium batteries this time. Question: how many Prius batteries would it take to equal the RAV4-EV battery packs? Chevron might restrict how large the NiMH battery packs could be but could Chevron knock Toyota out for adding multiple Prius batteries to the same vehicle?