Toyota in no rush to offer E85 fuel driven cars

In an interview with The Nation, he said that to ensure constant and sufficient supply of ethanol for the new fuel with an ethanol content of 85 per cent, sugar-cane areas must be increased. This could mean more encroachment

on forest reserves. "At Toyota, we're concerned with environment issues," he said. "The government will need to carefully balance the pros and cons."

The Agricultural Economics Department forecast that the primary sugar-cane price in the 2007/2008 harvest season would be above Bt800 per tonne, and the plantation area this year would be 6.4 million rai - against 6.3 million rai last year.

With a yield of 10.9 tonnes per rai, cane output would be 69.9 million tonnes, turning into 7.21 million tonnes of sugar. While 2 million is for domestic consumption, 5.2 million tonnes

would be exported. Less than 1 per cent is for ethanol.

Toyota, now Thailand's largest maker of passenger cars, is ready to have Western carmakers test the waters to learn what problems the companies and consumers will experience.

Sonoda said the market penetration would have no impact on Toyota, as E85-compatible cars would be dearer than those compatible with E20.

According to the Energy Ministry, BMW, Ford and Volvo have expressed interest in importing E85 vehicles. Ford executives last week mentioned that once tariffs on the cars are cut, the company would be ready to start selling them in six months.

Sonoda also brushed aside rumours that Toyota does not want to join the E85 market to avoid cannibalising its conventional market. Supporting the rumour was the fact that it is one of six auto companies entitled to tax incentives from the Board of Investment for the production of environmentally friendly cars - eco-cars.

Yet, to Sonoda, E85 would not affect the company's planned manufacturing of eco-cars in the Kingdom. "While the eco-car is an automotive innovation, E85 is a fuel innovation. If the market welcomes the new fuel product, both innovations can be mingled," he said. Then there is the low combustion efficiency of the fuel. It requires periodic refilling. "We're unsure if this would be good for our customers."