Automotive News New Powertrain Technologies Conference

Kazuhiko Miyadera Executive Vice President Research & Development

28 March 2007

TOYOTA MOTOR EUROPE AgendaAgenda

I.I. Awareness Awareness ofof IssuesIssues

II.II. ’s Toyota’s ResponseResponse •• Automotive Automotive FuelFuel DiversificationDiversification •• Hybrid Hybrid TechnologyTechnology

TOYOTA MOTOR EUROPE Awareness of Issues AutomotiveAutomotive PowertrainPowertrain IssuesIssues

AcceleratedAccelerated GlobalGlobal developmentdevelopment 1.1. Energy Energy ResourcesResources consumptionconsumption ofof ofof industryindustry && technologytechnology fossilfossil fuelsfuels inin thethe 21st21st centurycentury

2.2. Global Global WarmingWarming

(CO(CO22 reduction)reduction) PopulationPopulation growthgrowth (in(in USA,USA, Asia,Asia, etc.)etc.)

IncreasingIncreasing numbernumber 3.3. Air Air QualityQuality ofof motormotor vehiclesvehicles

Three issues: Energy Resources, Global Warming, Air Quality

TOYOTA MOTOR EUROPE Future Automotive Fuels Primary energy Automotive fuels CurrentCurrent OilOil Gasoline,Gasoline, MainstreamMainstream dieseldiesel

NaturalNatural gasgas SyntheticSynthetic fuelsfuels (FT(FT syntheticsynthetic diesel,diesel, etc.)etc.)

Fossil Fuel MobileMobile useuse CoalCoal BiofuelsBiofuels

GaseousGaseous fuelsfuels BiomassBiomass (CNG,(CNG, LPG)LPG)

HydrogenHydrogen Solar,Solar, wind,wind, hydro,hydro, nuclearnuclear ManufacturingManufacturing ResidentialResidential ElectricityElectricity Other Sources StationaryStationary UseUse

Automotive energy sources diversify into liquid, gas and electricity

TOYOTA MOTOR EUROPE Automotive Fuel Diversification Scenario

OilOil remainsremains mainstreammainstream UnconventionalUnconventional oiloil OilOil 1.1. ImproveImprove gasolinegasoline && didieselesel vehiclevehicle technologytechnology (Reduce(Reduce oiloil consumptionconsumption toto cutcut COCO22)) DrillingDrilling && storstorageage technologytechnology

NaturalNatural gasgas GasificationGasification && syntheticsynthetic technologytechnology COCO22 sequestrationsequestration 2.2. PromotePromote adoptionadoption ofof SyntheticSynthetic fuels alternativealternative fuelsfuels (FT(FT syntheticsynthetic diesel,diesel, etc.)etc.) ProductionProduction technologytechnology StabilizeStabilize quantityquantity ofof supplysupply ObtainObtain desireddesired propertiesproperties CoalCoal BiofuelsBiofuels

GasGas storagestorage technologytechnology BuildBuild infrastructureinfrastructure GaseousGaseous fuels (CNG,(CNG, LPG)LPG) production Biomass Hydrogen HydrogenHydrogen storagestorage technologytechnology Biomass COCO22 sequestrationsequestration

HydrogenHydrogen

ProductionProduction efficiencyefficiency BuildBuild infrastructureinfrastructure (cost)(cost) generation Electricity UltraUltra highhigh densitydensity electricalelectrical storagestorage technologytechnology Solar,Solar, wind,wind, ElectricalElectrical storagestorage technologytechnology COCO22 sequestrationsequestration hydro,hydro, nuclearnuclear ElectricityElectricity

Short-termShort-term 20102010 2030–2030– Mid-to-long-termMid-to-long-term Oil will stay mainstream for the time being. Alternative fuels pose many challenges

TOYOTA MOTOR EUROPE Gasoline & Diesel Vehicle Technology Evolution

GasolineGasoline engineengine DieselDiesel engineengine

Piezo injector Common rail D-4S VVT-i (180MPa) Low friction Common rail DPNR (135MPa) Lean burn 3-way catalyst Driving performance (dynamics) Driving performance (dynamics) Driving performance Driving performance (dynamics) Driving performance (dynamics) Driving performance EnvironmentalEnvironmental performanceperformance EnvironmentalEnvironmental performanceperformance (fuel(fuel economy,economy, emissions)emissions) (fuel(fuel economy,economy, emissions)emissions)

Improving gasoline & diesel engine performance with new technologies

TOYOTA MOTOR EUROPE Transmission Technology Evolution

TransmissionTransmission

Vehicle Dynamics 8AT Integrated Management CVT

6AT Start & Stop ECT-i Flex lockup Driving performance (dynamics) Driving performance (dynamics)

EnvironmentalEnvironmental performanceperformance (fuel(fuel economy,economy, emissions)emissions)

Improving transmission performance with new technologies

TOYOTA MOTOR EUROPE Key Points in Alternative Fuels Selection

EnergyEnergy densitydensity

WellWell-to-WheelWell--toto--WheelWheel COCO22

ResourceResource

TOYOTA MOTOR EUROPE Energy Density

Toyota estimate

Diesel Petrol 10

Batteries Gaseous Liquid

Ethanol Hydrogen absorbing 5 alloy(2wt%) CNG (20Mpa) High-pressure hydrogen Lithium-ion (35MPa) battery Volumetric energy density (Gasoline=10) 0 Low Density High Density

Larger Tank Smaller Tank

TOYOTA MOTOR EUROPE Well-to-Wheel CO2 Emissions

Well-to-Tank CO2 (WTT) Relative CO2 emissions indexed to gasoline as 1.0 Japanese 10-15 test cycle Tank-to-Wheel CO2 (TTW) Petrol Diesel Gasoline Hybrid

Ethanol: sugar cane Ethanol: corn FT synthetic diesel: biomass FT synthetic diesel: coal

Fuel Cell : CNG Electricity: coal or Electricity: nuclear

-1 -0.5 0 0.5 1 1.5 Source: Mizuho Information & Research Institute report

TOYOTA MOTOR EUROPE Alternative fuels - Basic Characteristic

Energy density Well to Wheel Resource (Cruising distance) CO2 Emission

Bio-fuel better better worse

depend on Hydrogen worse primary energy better

depend on Electricity better worse primary energy

TOYOTA MOTOR EUROPE Use of Biofuels

BiofuelsBiofuels havehave supplysupply volumevolume limitationslimitations

Sugarcane Corn Grass & wood (sugar) (starch) (cellulose)

Bioethanol is suited to low-concentration blends for the time being

Rapeseed Palm

Bio-diesel should be 2nd generation or low-concentration FAME

TOYOTA MOTOR EUROPE Toyota’s Fuel Cell Technology

Passenger car TOYOTA-FCHV

Residential FC Bus Fixed location cogeneration system (Aisin Seiki Co. Ltd.) FCHV-BUS (, Ltd.) Hot water tank

Toyota FC stack Main unit

“Kei” mini-vehicle IndustrialIndustrial vehiclesvehicles MOVE FCV-K-Ⅱ( Motor Co., Ltd.) FCHV-F (Toyota Industries Corporation)

TOYOTA MOTOR EUROPE Plug-in is: aa hybridhybrid ofof electricelectric vehiclevehicle && petrolpetrol (diesel)(diesel) vehiclevehicle or aa gasolinegasoline (diesel)(diesel) hybridhybrid vehiclevehicle withwith anan externalexternal rechargerrecharger

Gas station Household electrical energy

Engine Battery Motor Fuel tank

TOYOTA MOTOR EUROPE Yearly Sales of Hybrid Vehicles Worldwide 10001000 ★

900900

(1,000(1,000 units)units) 800800

700700

600600

500500

400400

300300

200200

100100

19971997 19981998 19991999 20002000 20012001 20022002 20032003 20042004 20052005 20062006 2007 2007 2008 2008 2009 2009 201X 201X (year)(year)

Aiming to reach one million per year early in the 2010s decade

TOYOTA MOTOR EUROPE Ultimate Eco-Car Energy diversity CO2 reduction Air quality

Hybrid Technology

Gasoline, Gaseous Synthetic Biofuels Hydrogen Electricity Diesel Fuels Fuels

the Right Car the Right Place the Right Time

TOYOTA MOTOR EUROPE TODAYTODAY forfor TOMORROWTOMORROW

TOYOTA MOTOR EUROPE Thank you

TOYOTA MOTOR EUROPE