Toyota’s North American chief sat down with Business Week for an interesting Q&A,

Toyota’s Jim Press Discusses the Future
Toyota North America’s new head on moving the company forward, his role, the competition and alternative fuel

MK: What’s your view on hybrid technology?

JP: We recognize more and more hybrid technology is going to be a key technology for the future success of this business. Hybrid is going to be hybrid diesel. Fuel cell cars are hybrids. The internal combustion engine cars we are selling today are hybrids. Flex fuel vehicles will be hybrids. Hybrid is the enabling technology that makes all of those more efficient. Diesel, gasoline, hydrogen and biodiesel are all fuels that feed through a common system, which is a hybrid. This is the thing we’re developing. Hybrid is the way you gain the synergy of combining stored energy that you store when you don’t need it and release when you do.

MK: You are chairman of the Alliance of Automobile Manufacturers, the industry’s top trade group, and you are the first international automotive executive to do so. How’s that going?

JP: It’s a time of turbulence and great interest in fuel. We’ve been dealing with a war of words over who is at fault with high gas prices. There are those who think the auto industry is at fault because their cars don’t get very good mileage. But the auto industry doesn’t bring the oil out of the ground and price it. OPEC does; oil companies do. The issue of gas prices is a consumer issue and becoming a political one. It’s really a great time to have all this stuff stirring around. Ten years ago, CAFE was an issue for us but the public wasn’t involved. Now they are engaged. So it is a great time for the industry to utilize its capability to educate through an ad campaign to consumers and thought leaders making decisions on future regulations. It’s a very stimulating opportunity

MK: Does Toyota have plans for ethanol vehicles?

JP: We have no flex fuel vehicles. We’re studying them.

MK: There’s suddenly great interest in it and in Brazil, which has 90 percent of its fleet using ethanol.

JP: As for Brazil, they use sugar to make ethanol. They have lots of it – too much. And sugar cane is more efficient than corn. Their total vehicle population is smaller and more concentrated. Also in Brazil, they have government policy that has driven them in that direction just Europe has one that has encouraged diesel. Here, we don’t have that. So it is really hard for the free market on its own to embrace a fuel that costs more to produce and is less efficient. It’s also a fuel that if we really did embrace it would require a tremendous amount of corn production. That would bring up other issues – land use issues, significant changes to our structure of tariffs on importation. Who is going to pay for ethanol gas stations? There are less than 600 in the country. There’s one in California, and it’s not open to the public. All those flex fuel vehicles sold in California provide a credit for CAFE but they are running on gasoline. We need to have more gas stations and more ethanol available. E10 we can run through regular gas station and today’s cars can use it. If we all went to E0 today, we’d get at least 10 percent more out of our gallon of gas, which may be a way to phase it. But now it doesn’t have the same CAFE credit. So there are obstacles. Ethanol definitely helps in the cause of dependence on foreign oil.

To read the full interview, click here.