Was the Toyota Prius government funded?

Was the battery and hybrid system of the Prius government funded? Rumours have been swirling over this rather contentious issue since Jim Press (ex-Toyota employee, and now vice chairman and president of Chrysler LLC) dropped a bombshell when talking with BusinessWeek recently.

“The Japanese government paid for 100 percent of the development of the battery and hybrid system that went into the Toyota Prius,” said Jim Press

Assuming for a moment that this is true, it goes a long way to explaining how Toyota have been able to produce the Prius without losing a King’s ransom while GM struggle to find a way to get their Volt to market, at a price that will make a profit and be deemed good value by the consumer.

For many years now, GM have expressed their concerns at the viability of the petrol-electric hybrid from a cost per unit point of view, while Toyota in the meantime has taken the world by storm with their hybrid Prius.

Looked at from a different perspective, it is interesting how a petrol-electric drive system conceived in North America has gone on to almost define a Japanese car company. While the US manufacturers were crushing plug-in electric cars, Toyota were busy perfecting the hybrid.

Toyota have of course denied that they received any funding for the development of the Prius.

“I can say 100 percent that Toyota received absolutely no support — no money, no grants — from the Japanese government for the development of the Prius,” said Toyota spokesman Paul Nolasco.

It’s an interesting claim, but at the end of the day does it really matter what happened? If the Japanese government had the foresight to support Toyota in the development of a car that would ensure their competitiveness then kudos to them. With a million hybrid sales under their belt and the plan to sell a million hybrids a year, it is all smiles over at Toyota HQ.

Maybe there is a lesson here for other governments? You know, the ones who prefer spending tax-payer dollars subsidizing ailing manufacturers who build cars that are rapidly becoming irrelevant?

[Source: BusinessWeek]