Toyota could see major losses from its fuel cell vehicle

Fuel cell vehicles may represent a major financial risk for the auto industry

Clean transportation has become a major focus for most of the world's leading automakers. Several companies have begun weighing the values of conventional battery electric vehicles and those powered by hydrogen fuel. On one hand, batteries are less expensive than fuel cells as is building an infrastructure capable of supporting battery electrics. Fuel cells, however, boast of better performance and efficiency, providing a range of operation that conventional batteries cannot compete with. Where the auto industry places its focus may come down to the production costs associated with these vehicles.

Toyota could see losses as much as $133,000 for every fuel cell vehicle it sells

Japanese automaker Toyota is one of the companies that will be bringing its new fuel cell vehicle to the market in 2015. The automaker sees significant promise in hydrogen fuel cells and believes that they will be well accepted among consumers. That is the hope, anyway, as consumer adoption will be vital if Toyota wants to see any profits come from its fuel cell vehicles. According to a new report from Edmunds.com, Toyota is taking a costly gamble on the success of fuel cell vehicles. The report suggests that each vehicle could result in a $133,000 loss for the Japanese automaker.

Fuel cells remain a very costly investment

The potential loss is due to the high cost of fuel cell technology. Fuel cells produce electricity through the consumption of hydrogen, and this process is enabled through the use of rare and expensive materials, such as platinum. A single fuel cell system could cost a proverbial fortune, and Toyota has invested enough money to build a small fleet of vehicles equipped with these energy systems.

Some companies are looking for a solution to the cost issue

Cost has been a major concern for automakers interested in fuel cell vehicles for some time. Several companies have begun working together in order to address the cost issue, hoping to develop fuel cells that are less expensive and more commercially viable. This may take years to accomplish however, and companies like Toyota are not willing to wait any longer.