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Evaluating Toyota's Hydrogen Fuel Cell Car Gamble

NEW YORK (TheStreet) -- There are few subjects as multi-dimensional and complex to analyze as is the prospects for hydrogen fuel cell cars obtaining a meaningful market share of new car sales 10-20 years from now. This article is the second in a series, with other articles to come.

I recently had the opportunity to become one of the first people outside of Toyota (TM - Get Report) to spend time with the final production version of its hydrogen fuel cell car (look, not drive). It goes on sale in Japan next April, and in California a couple of months thereafter. The price in U.S. has yet to be announced, but in Japan it will be just under $70,000.

Before we get into the broader issues with hydrogen as a fuel, how it compares with gasoline, diesel and battery-electric cars and infrastructure build-out, I need to point out one thing which was not previously well-known: The back seat of this Toyota hydrogen fuel cell car will fit only two people.

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The fact that you can fit only a total of four people in the car will alone prove to be a limiting factor in terms of selling it in California. General Motors (GM) made a similar mistake with the Chevrolet Volt. Many people who considered the Volt rejected it because they want the option, however infrequently used, to fit a fifth person in the car.

The reason Toyota won't fit a fifth person in this new car has only indirectly to do with packaging. Unlike the Volt, there is no overly intrusive "tunnel" making a third back seat passenger difficult. Rather, it has to do with weight concerns: If you engineer a car to hold five people instead of four, you need beefier suspension and more weight in the construction all around. That, in turn, reduces fuel efficiency, and Toyota could not afford that extra weight on the first version of this new type of car. Surely this will change around year 2020 with a new design.

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