Tadano, a major manufacturer of cranes, has converted one of its crawler cranes, which can lift up to 1600 tons, to electric power. By changing the power source from a diesel engine to an electric motor, the company has been able to maintain the performance of the existing product while reducing CO2 emissions to zero. The company converted its CC 88.1600-1 lattice boom crawler crane to electric power. This is a large crane equipped with crawlers instead of tires, and is used in plant and bridge construction, as well as wind power installation.

The electrified crane is connected by cable to the main unit and power supply equipment, and two 390-kilowatt electric motors drive the hydraulic pump. There are no CO2 emissions during operation. Compared to existing products powered by diesel engines, this crane will reduce CO2 emissions by approximately 55 tons per year. The crane itself will be manufactured in Germany, while the electrification equipment will be produced in Japan. The crane is expected to go on sale in the summer of 2025 as part of the company’s EVOLT line of electrified products.

The company will also make existing products already sold compatible with electrification. The necessary modifications, such as replacing the drive container, which is the heart of the crane, will be kept to a minimum. The company will respond flexibly to customers’ electrification needs.

Source: The Nikkei

PSR Analysis: There is a strong demand for decarbonization of machinery used in clean energy generation, such as offshore wind power. The same applies to large cranes. They have already commercialized an electric luffing crane that can work for about 5 hours and travel about 42 km. The specifications will probably be improved in the future, but I think the market should first appreciate the fact that the product has been commercialized as an option for users. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

Hyundai Motor in August announced plans to expand its lineup of hybrid vehicles from seven to 14 models in response to slowing global demand for electric vehicles. The company will also use HVs for the first time in its Genesis luxury car brand. The company also announced plans to increase its annual global sales volume by 30% from 2023 to 5.55 million units by 2030, and to invest 120.5 trillion won (about 13 trillion yen) in R&D and capital investment over the 10 years out to 2033. The company will focus on advanced technologies such as next-generation HVs, in-vehicle batteries and automated driving technology.

Source: The Nikkei

PSR Analysis:  Hyundai Motor’s shift in strategy is aimed at responding quickly to the changing needs of the global market. Several EV battery fires have occurred in Korea, and these incidents have contributed to a slowdown in domestic sales of BEVs.

Not only Hyundai Motor, but many other automakers are seeking strategies to respond to the slowdown in demand for EVs, but if HVs grow, competition with Toyota is inevitable. Toyota has a wealth of knowledge about HVs and is one step ahead of the competition in the HV market.

It is not clear which direction the global automotive market will take. When the EV shift began, many predicted that BEVs eventually would account for 90% of the market, but this does not seem likely. I believe that the tidal wave will not be consolidated into one type of vehicle, and that we will see a diversification of powertrains, including FCVs and ICEs. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

I traveled recently in the Toyosu area of Tokyo, an upscale residential area, and while there I stopped at a Hydrogen refueling station. While there, I spoke with one of the station’s staff, and I found his comments interesting.

He told me that the only FCVs on the market in Japan are the Toyota MIRAI sedan and Crown FCEV. Honda used to sell the Clarity FCV, but it has been discontinued and few are seen on the road. There are also no FCVs in trucks. There are about 80 hydrogen buses in Tokyo, but they don’t stop at this station because there is a hydrogen station is in the bus company’s office.

On weekends, maybe four or five cars come to the station each day, but on weekdays there are often days when not even one car comes. It’s very quiet. Filling up with hydrogen requires a person with a national qualification, so it’s not possible to operate it like a self-service gas station.

I thought his comments were interesting, so I did some research on hydrogen stations. Here is what I found.

Fewer Stations

First, as of the end of April 2024, there were 152 hydrogen stations in Japan. There are 21 in Tokyo, and they are all privately owned. On the other hand, there are about 24,000 gas stations nationwide, and about 900 in Tokyo. As we can see, there are many fewer hydrogen stations than gas stations, less than 1% as many.

Higher Costs

The construction cost of a hydrogen station is about US$ 2.9 million (400 million yen), not including the cost of the land. The maintenance cost is also high, ranging from US$ 209,000 to US$ 285,000 (30 to 40 million yen). The government will provide a subsidy of up to about US$ 1.45 million (200 million yen), but you will still have to start with your own funds of about US$ 1.45 million (200 million yen).

This is extremely disadvantageous for landowners. When using expensive urban land such as that in Toyosu, hydrogen stations are hardly profitable as a business and are extremely unprofitable. It is much more profitable to use the land for buildings and condominiums. In rural areas where land is cheap, there are few FCVs and almost no demand for stations.

In short, when land is used for business, hydrogen stations do not make a profit and therefore do not proliferate.

FCVs Not Popular

FCVs are not popular in Japan for several reasons. Even though the government and manufacturers are promoting the benefits of FCVs, the number of FCVs in Japan today is no more than about 5,000 – 8,000. In FY2023, the number of new FCV cars sold was 422, accounting for just 0.02% of the total. In contrast, the number of EVs sold was 43,991, accounting for 1.66% of the total. Even looking at the number of vehicles owned, there were about 7,300 FCVs compared to 229,000 BEVs and 208,000 PHVs.

Here are some of the main reasons why consumers are not buying FCVs.

·       Few Hydrogen Fueling Stations as I mentioned above. Compared to BEVs, FCVs have the advantage of a shorter refueling time, but compared to the 21,600 EV charging stations nationwide, there are far too few hydrogen stations. FCVs also have the advantage of a longer range (750-850 km), but this does not mean that they do not need to be refueled. Drivers still must worry about getting to the next hydrogen station.

·       Higher Price. The price of the MIRAI is about US$ 50,700 (7.3 million yen), which is in the price range of luxury cars, but compared to other luxury cars, it is not well known and does not have much added value as a luxury car. Although the government and local governments offer subsidies for the purchase of FCVs, there is still a burden of US$35,000 (4-5 million yen), and in this budget range, there are plenty of options for gasoline or diesel-powered cars and BEVs.

·       High Maintenance Costs. While many people would like to use FCVs in trucks, since the long range of FCVs is highly compatible with trucks, whose routes can be predicted to some extent in advance. However, both Fuel Cell and Hydrogen are extremely expensive to operate and maintain. In addition, maintenance cannot be done in-house and must be done by the manufacturer or dealer. Until these costs are brought down to the level of gasoline and diesel vehicles, it will be difficult to popularize FCV trucks.

·       Emissions Benefits Uncertain. The fact that they don’t emit CO2 is certainly a big selling point in terms of environmental performance, but to begin with, there are three types of hydrogen: gray, blue and green. As of today, all FCVs in use are gray, and we still have to wait for blue and green to become a reality. Even if they become a reality, they are likely to be extremely expensive.

Conclusion

TOYOTA is fighting a lonely battle with FCVs, and if they don’t give up, there will probably be further improvements in specifications and costs. In the end, however, we cannot expect widespread adoption without economic rationality.

The proliferation of hydrogen stations and FCVs is often talked about as a “chicken and egg” problem, but regardless of whether one or the other is prioritized, until the unique benefits of FCVs that are not found in current mainstream ICE are accepted by market, the realization of a hydrogen society will remain a pipe dream. Simply stating that the benefits are zero emissions will not appeal to the majority of buyers. #FCV #hydrogen #hydrogenstation #PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

By Akihiro Komuro, Research Analyst, Far East and Southeast Asia

Hitachi Construction Machinery said it is demonstrating a rechargeable all-electric dump truck at a mine in Zambia. It’s the world’s first demonstration of an ultra-large machine with a payload capacity of 200 tons.

Operating conditions and battery life will be verified over a one-year period. The original plan was to have the system in operation by the end of 2024, but the company now plans to launch it in 2025 or later.

The overhead wires will be installed along the mine’s route and the battery will be recharged as it travels along the route. This system allows for more efficient operation than recharging at stops. The batteries mounted on the vehicle body will also be lighter, increasing the payload capacity of the dump truck.

It is estimated that half of a mining company’s CO2 emissions come from transportation and mining operations at the mine site. Hitachi Construction Machinery estimates that by replacing conventional diesel-powered dump trucks with all-electric dump trucks, the annual CO2 emissions per truck (approximately 3,000 tons) can be reduced to zero.

Source: The Nikkei

PSR Analysis:  Electric models are also being developed in the field of mining equipment, where high output power is required. Power supply by overhead wires is the best solution at this point. I forecast that electric mining equipment will continue to be powered primarily by overhead power lines. Batteries themselves are heavy, and if they eat up the loading capacity of trucks, they will greatly affect efficiency. In addition, considering the time required to recharge large-capacity batteries, it is desirable to be able to supply power while the machine is in operation. PSR

Korea’s Hyundai Motor Group is going on the offensive with hybrid vehicles. Its subsidiary Kia plans to introduce HV models in nine of its main models, doubling its current sales volume to 800,000 units by 2028. Kia will temporarily review its investment focus on EVs, where competition is heating up globally, to flexibly respond to market trends.

In early April, Kia’s CEO showed signs of impatience at a business strategy meeting in Seoul, admitting that the EV market is slowing down and pushing back the goal of surpassing sales of 1 million EV units by 2026 to 2027.

At the same time, he announced the expansion of HVs: by 2028, he will introduce HVs in nine major models worldwide, increasing HV sales from 372,000 units (12% of the total) in 2024 to 800,000 units (19%).

Kia’s new vehicle sales in 2023 will be 3.01 million units. Of these, less than 20% will be in Korea. The company aims to expand sales of HVs in the U.S. and European markets in addition to the domestic market.

Kia’s production structure will also respond to the shift in sales strategy. Kia will engage in “mixed production” by manufacturing EVs, HVs and engine vehicles at its 13 plants in Japan and overseas, allowing it to flexibly change the production ratio.

Kia will also increase its R&D spending, investing 38 trillion won over the next five years to 2028, an increase of 5 trillion won (approximately 560 billion yen) from the existing five-year plan (2023-2027). Development of new engines for HVs is underway to improve energy-saving functions and increase maximum driving range.

According to the Korea Automobile Mobility Industry Association, new vehicle sales in Korea will fall to 116,000 EVs in 2023, down 6% from the previous year. HVs, on the other hand, will increase by 55% to 280,000 units. Rising interest rates and a lack of charging facilities have slowed EV consumption, and HVs are gaining popularity due to their affordability and high fuel efficiency.

Source: The Nikkei

PSR Analysis:  Until now, Korean automakers, led by the Hyundai Group, have increased their market share by focusing exclusively on BEVs, but they are now undergoing a major shift in strategy to respond to changes in the market. Until now, Europe and other countries have taken the lead in trying to exclude hybrids from the market. On the other hand, the market has gradually recognized the weaknesses of BEVs, and the advantages of hybrids are being reassessed. In particular, demand for BEVs has slowed, as evidenced by reports of an oversupply of EVs in China. In terms of responding flexibly to such market changes, Kia’s shift in strategy this time is highly commendable.

Japanese automakers, led by Toyota, are technologically ahead of Korean automakers in hybrid technology, and a large investment will be necessary for Korean automakers to catch up. Since the gap is not so small that they can catch up immediately, prompt action based on this policy shift will be required for Korean brands to maintain and expand their presence in the global market. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

On March 28, Kubota unveiled the first prototype of a fuel cell-powered tractor. Although no release date has been set, the company will consider installing fuel cells in unmanned, automated tractors. Kubota is also developing battery-powered agricultural equipment, but the company believes that hydrogen-powered fuel cells will be effective for medium-large sized agricultural equipment.

Kubota is rushing to commercialize fuel cells because it believes demand will grow in developed countries such as Japan, Europe and the United States as a result of the trend toward decarbonization. The prototype machine has about 60 horsepower and has three hydrogen tanks installed above the cabin, which are used in Toyota’s Mirai fuel cell car. It generates electricity by reacting hydrogen with oxygen to power the engine. In the experiment, a tractor was equipped with a plowing unit to till the soil.

Compared to passenger cars, agricultural equipment requires longer operating hours and more power for certain tasks. Kubota expects that small and medium-sized agricultural equipment can be powered by rechargeable batteries, but for large and medium-sized agricultural equipment, the batteries may become too heavy, so fuel cells may be more effective. The company will promote the decarbonization of agricultural equipment through an “all-round strategy,” including the use of hydrogen engines.

A demonstration was also conducted in which hydrogen was filled into a tank on the top of the tractor; the tank can be filled with about 7.8 kilograms of hydrogen in 10 minutes, allowing the tractor to run for about four hours.

The prototype machine is about one-third as loud as conventional diesel-powered machines. In addition to being able to work at night, the machine also produces less vibration in the cab, which is expected to help reduce the burden on farmers.

Source: The Nikkei

PSR Analysis: The development of fuel cell powered equipment is being promoted by leading OEMs in each segment of industry. In the agricultural equipment segment, Kubota was one of the first OEMs to actively pursue the development of fuel cell-powered machinery. Kubota is a member of the Hydrogen Value Chain Promotion Council, an organization that aims to promote hydrogen in Japan. It’s one of the 25 board members that include Toyota, Kawasaki Heavy Industries, Kobe Steel, and Toshiba.

From a practical standpoint, there are many challenges to the widespread use of hydrogen and fuel cells. Even if equipment is equipped with fuel cells, if CO2 is generated in the process of producing hydrogen, the actual CO2 reduction effect will be limited. Diesel engines are still the mainstay of agricultural equipment, and it is essential to establish a supply chain that is as easy to obtain as that for diesel oil. It would be unreasonable to ask farmers to bear a greater burden of fuel costs.

Given the difficulties in solving these problems, it could take several decades before fuel cells are fully accepted in the marketplace. It is not certain that the current development of fuel cells will be recognized as an extremely worthwhile investment in the future–we will have to wait and see. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

Toyota Motor Corporation and Chiyoda Corporation have announced the joint development of a hydrogen production system. The two companies plan to begin demonstration tests at Toyota’s main plant in fiscal 2025 and hope to begin marketing the system around fiscal 2027.

The system will produce hydrogen by electrolyzing water. It will have an output of about 5 megawatts and will be able to produce about 100 kilograms of hydrogen per hour. The new plant has a footprint of 6 meters wide by 2.5 meters deep, about half the size of a typical plant. By linking multiple plants, the production volume can be significantly increased.

The operation plans to reduce costs by using FC system components from Toyota’s MIRAI FCV. In the demonstration, the hydrogen produced will be used on equipment at the Toyota plant.

Source: The Nikkei

PSR Analysis: If water could be electrolyzed to produce hydrogen, which could then be used to power mobile units, water could be used like gasoline. There is also the possibility of replacing oil, which is heavily dependent on the Middle East. Such a dream cannot be realized immediately of course, but the joint project between Toyota, which has a proven track record in FCV development, and Chiyoda Corporation, which has a track record in hydrogen energy plants, is worthy of attention.

While the system discussed in this announcement is not large enough to be installed in a mobile vehicle, and will be used at Toyota’s plant, there is still potential for the technology to be used in future vehicles.

The value of new fuels such as hydrogen is being reassessed. For years, Toyota’s chairman has stated that the enemy is not the engine, but CO2, and the company has continued to invest in all directions: engines, batteries, PHEVs, and FCVs. Of course, there are many negative opinions about hydrogen, but I think that we are not yet at the stage where we can determine whether hydrogen can be used or not. The budget for such a project is limited, and in this sense, it makes sense for Toyota, Japan’s largest company, to do this. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

Domestic motorcycle shipments increased for the first time in two years to 376,720 units in 2023, up 4% from the previous year. Class 2 mopeds, which have relatively low maintenance costs, performed well, increasing 47% year-on-year. The shortage of semiconductors and the easing of logistics disruptions also contributed to the increase in shipments.

Class 1 mopeds (50cc and below) fell by 29% to 92,824 units. Class 2 mopeds (over 50cc and under 125cc) were up 47% to 149,655 units, light motorcycles (over 125cc and under 250cc) were up 16% to 66,630 units and small motorcycles (over 250cc) were down 6% to 67,611 units.

Source: The Nikkei

PSR Analysis: Since the outbreak of COVID-19, motorcycles have been re-evaluated as a form of mobility that allows people to avoid crowds, and the renewed awareness of their convenience has contributed to this increase in shipments. Although not mentioned in this article, sales of fun-to-ride large motorcycles have also been relatively strong. Some new vehicles are still taking a long time to be delivered, so shortening lead times for shipments will be an issue in the future. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

Honda plans to end production of the Honda e EV by January 2024. This is the company’s first mass-produced EV, but sales have been sluggish, falling short of the annual domestic sales target of 1,000 units. Going forward, the company will focus on commercial light EVs, which will be launched in the spring of 2024, to increase the electrification rate of the vehicles it sells.

The Honda e was launched in 2020. The vehicle is priced at 4.95 million yen and has a range of 259 km (WLTC mode). Sales in Europe have already been discontinued. Sales in Japan will also be discontinued once stocks run out.

The Honda e was not originally intended to be a high-volume model, but it did not meet its sales target. The company plans to expand the model lineup, starting with the N-VAN e:, a light electric vehicle to be launched next year.

Source: The Nikkei

PSR Analysis: The Honda e was not in the luxury price range, but with its compact body size it was suitable for Japanese road conditions and wit its futuristic design, it was the right approach for the first stage of Honda’s EV penetration in Japan. The end of sales of such a flagship model shows the difficulty of EV penetration in Japan.

In the first half of 2023, 22,857 EVs (standard passenger cars) were sold, which is only about 1.67% of the total sales volume. In addition, sales of light EVs totaled 25,807 units in the first half of the year. Therefore, including mini-vehicles, total EV sales were 48,664 units, or 2.38% of all EVs sold (standard passenger cars and mini-vehicles) (PHEVs accounted for 25,163 units, or 1.23%).

Of course, not only Honda, but also Toyota, Nissan, and many other Japanese manufacturers are selling EVs, but there are many issues that need to be resolved before EVs can be widely adopted in Japan.

Weak consumer attitudes form a high hurdle for switching from existing engine models. Manufacturers and the government are promoting V2X and environmental performance, but it will take time for full-scale adoption. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

The Japanese automaker has recently changed its tune about building BEVs and is now claiming solid state batteries will be in vehicles starting in 2027.

Source: Electrek: Read The Article

PSR Analysis: This sounds really good, but Toyota has been talking about solid state batteries since the mid 1990’s and has promised their introduction several time already. We need to be cautious about this as Toyota also has said that their new ammonia engine could bring the end of EVs (see next article). Toyota is late to the EV party and is now sending mixed signals.   PSR

Guy Youngs is Forecast & Adoption Lead at Power Systems Research