Business / Corporate

Honda takes on Toyota Mirai with roomier ¥7.66 million fuel cell sedan

Bloomberg

Honda Motor Co. will begin sales of a ¥7.66 million hydrogen-powered sedan in March, a car that has a greater range and roomier interior than Toyota Motor Corp.’s Mirai.

Honda initially aims to sell 200 units annually of the car, called Clarity Fuel Cell, with government agencies and corporate fleets booking the first year’s production run, Kiyoshi Shimizu, the car’s chief engineer, said in an interview before the unveiling of the model at the Tokyo Motor Show on Wednesday.

Both the Clarity and Toyota’s Mirai, which starts from ¥7.24 million in Japan, will benefit from subsidies of as much as ¥3 million being offered to buyers of fuel cell vehicles. Promoting a “hydrogen-based society” is part of a broader drive by the government to reduce a reliance on imported oil and provide an alternative energy source to nuclear power, which has faced public resistance after natural disasters crippled the Fukushima plant in 2011.

“We don’t expect the government subsidies to continue forever,” said Shimizu. He said by 2020 the company aims to be selling the car at a price that is comparable to what it costs now with subsidies.

Carmakers still face the hurdle of a lack of hydrogen fueling stations, which are costly to build and operate without subsidies, as well as the high costs of fuel stacks.

The subsidies mirror the inducements Japan offered to buyers of the first hybrids, including the Prius in the 1990s. Toyota and Japan today dominate global sales of dual-powered vehicles.

To address the problem of refueling, Honda will consider a packaged deal of providing a portable hydrogen station for every 20 to 30 fuel cell vehicles sold.

Honda has placed the downsized fuel cell stack under the hood instead of below the seats, as in the case of Toyota’s model, to give more interior room in the Clarity. The driving range of the sedan is more than 700 kilometers on a single charge, according to Honda, or 8 percent longer than the Mirai.

Honda’s new fuel cell stack is 33 percent smaller than the previous version, the company said in a statement. The smaller stack will allow Honda to add fuel cell variants to existing models, Shimizu said.

Toyota said this month it plans to boost Mirai sales to 30,000 units, including 12,000 in Japan, by 2020, the year when Tokyo hosts the summer Olympic Games.

Honda is also expecting sales will increase with efforts such as cooperation with General Motors Co. to cut costs on key materials and components, Shimizu said.

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