Polite war of words as Toyota and Chrysler clash on Prius funding
Jim Press insists that he did not intend to speak negatively of Toyota
Author: Robin Brown
Published: 03 April 2008
Last week Chrysler's Vice Chairman and President Jim Press made some apparently off-the-cuff remarks to the effect that Toyota - Press' previous employer - had received '100%' funding from the Japanese government towards the pioneering drivetrain found in the hybrid Prius.
Press had introduced the Prius to the US market and been the highest-ranking non-Japanese executive at Toyota which, it's fair to say, has been somewhat unimpressed by the remarks and barely stopped short of calling Press a liar, choosing its words carefully to suggest Press had 'misspoken'.
'It's inaccurate, and it would appear to contradict the remarks he made in the past,' said Xavier Dominicis, a spokesman for Toyota's U.S. operations. Whilst at Toyota, Press denied that Toyota received any subsidies to develop low-emissions vehicles at a congressional hearing a year ago.
The Japanese government has also denied that Toyota received subsidies, but does point out that Japanese car-buyers receive subsidies for buying low-emissions vehicles such as the Prius.
Chrysler has reacted by putting out an entry on its Firehouse corporate blog - explaining that Press 'was not speaking negatively of Toyota', but was citing Japan's example of cooperating with national companies.
Press was apparently pushing for similar support of car-makers from the US government in the shape of subsidies.
Toyota Prius
Toyota has built a reputation around the world for environmentally-friendly cars that have blazed a trail in green technology.
But it's not just the Prius that benefits from the technology - it's believed in some quarters that the Prius acts as a halo car, lifting the brand's products across the board and the perception of Toyota as a brand.
The Japanese manufacturer has recently suggested that it may introduce a Prius brand to capitalise on the hybrid's success.
In comparison no US manufacturer has managed to mass-market a hybrid vehicle, and leader-of-the-pack GM is suggesting that its best effort - the Volt may again be delayed a cost a prohibitive $50,000.
Subsidies
So it's not just Press' apparent slip of the tongue that's the issue here. If Toyota did receive money from the Japanese government to develop the Prius it puts the Japanese car industry at a distinct advantage over struggling domestic manufacturers.
And in light of the collapse of MG Rover in the UK and the more recent sale of Jaguar-Land Rover, the Prius issues raises the question of whether any global manufacturer can realistically compete with a government-backed company.
US manufacturers have long suspected that Toyota received government subsidies to invest in high-economy, low-emissions powertrains and have spent billions of dollars in trying to create their own hybrid systems, as well as hydrogen fuel-cell technology.
Whether Press did misspeak, or whether he was attempting to bolster the idea that the US government might prop up a struggling Chrysler with government hand-outs, his words have brought the issue of Toyota's dominance of the current automotive markets into sharp focus.
In the current US economic climate - with the very survival of Chrysler, Ford and GM far from guaranteed - and strict CAFE emissions regulations on the horizon - Press' comments may signify that he does not believe his company can survive without government support.
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