The auto industry is slowly shifting to develop more eco friendly cars, as CAFE regulations has increased to 54.5 mpg by 2020. Not only are there regulations on fuel emissions in the U.S., but the Chinese government has also begun to regulate the auto industry as well. The Chinese government is subsidizing the production of hybrid and electric vehicles in order to get a minimum of 5 million electric and hybrid vehicles on the road by 2020. Companies such as Nissan have begun to mass produce electric cars such as the Nissan Leaf, however, the majority of these production lines have been stopped due to a lack of profitability. This lack of profitability can be attributed to poor battery life and lack of charging stations. Hybrids and Electric vehicles thus only represent a short term solution to the emission problem. Electric vehicles can only be used for short trips, while hybrids are too expensive for the average consumer. This makes these vehicles less practical and not very popular among the average consumer.
What many car manufacturers view as the long term solution to the emission problem are fuel cell electric vehicles (FCV). These FCV’s are powered using hydrogen and only emit water and can travel up to 700 kilometers on one tank of hydrogen. Toyota revealed its plans to create an FCV in 2013, it is going to be introduced to the market in 2014, mainly in California. By 2015 Toyota hopes to build 50 hydrogen charging stations throughout California. The FCV is considered a better solution than the problems associated with battery operated vehicles, the only potential with the FCV is insuring a competitive price for hydrogen.
Moving forward, engineers will continue to make changes to the internal combustion engine to meet CAFE standards. This will serve as a bridge until more eco friendly vehicles become commercially viable. The FCV is looked upon by many players in the auto industry as potentially the future of eco friendly vehicles. It represents a cheaper alternative to electric vehicles, which makes it easier to be purchased by consumers in emerging markets. The ability to make cheaper FCV cars is crucial moving forward because it represents a way to lower automobile emissions as well as allow the auto manufacturers to target consumers in poorer emerging market countries.