September 2, 2005

Fuji Heavy to develop electric car with TEPCO

TOKYO (Reuters) - Subaru car maker Fuji Heavy Industries
Ltd. said on Friday it would co-develop and produce 10 electric
cars with Tokyo Electric Power Co. (TEPCO) to be tested by the
utility as a first step toward spreading the use of the
ecological vehicles.

Over the next year, the partners aim to develop cheaper and
more efficient technology to meet several conditions including
a minimum driving range of 80 km (50 miles) and a recharging
time of 15 minutes for 80 percent of the battery's capacity.

Japan's biggest electricity provider would purchase Fuji
Heavy's electric cars for internal use if the price were
limited to around 3 million yen, a Fuji Heavy spokesman said,
and test them for practicality, feasibility and cost.

Fuji Heavy currently has a prototype mini electric car that
runs on a lithium ion battery co-developed with NEC Corp..

The auto maker said last month it was also aiming to market
a hybrid gasoline-electric car in 2007 using the
high-performance battery, which lasts 15 years, or about twice
as long as those used in today's hybrid cars.

Most auto makers have given up on pure electric vehicles,
instead focusing on hydrogen-fuelled fuel-cell vehicles and
gasoline-electric hybrids as an ecological alternative to
internal combustion-engine cars because they found that
electric cars required too many hours of recharging for
relatively short distances.

Japan's Mitsubishi Motors Corp. is the only other major
auto maker with plans to commercialize electric vehicles. It
now has a prototype that can run 150 km (93 miles) on about 10
hours of recharging, also using a lithium ion battery, and is
aiming to expand the driving range to 250 km (155 miles) by

Mitsubishi Motors has said it was also talking with TEPCO
and other utilities to exchange information on electric
car-related technology as part of its aim to market a practical
and affordable electric minicar.

If the issues of charging time, driving range and cost are
resolved, electric vehicles could be a more attractive
alternative to fuel-cell vehicles, which require massive
investment for hydrogen fuelling stations, among other hurdles.

During the experiment, TEPCO would also gauge the
possibility of switching some or all of the 3,000 or so
in-house small cars that it uses for traveling short distances
beyond March 2006.

It estimated that if all 3,000 were switched to electric
vehicles, carbon dioxide emissions would be reduced by 2,800
tonnes a year and fuel costs cut by 190 million yen annually.

Fuji Heavy said it would aim to offer electric vehicles to
other companies through technology gained from the experiment,
with the eventual aim of commercializing them for personal use.

Shares in Fuji Heavy, held one-fifth by General Motors
Corp., jumped as much as 4 percent on local media reports of
the imminent announcement, before closing up 2.1 percent at 490

TEPCO shares rose 0.18 percent to 2,720 yen.