I'll admit right up front, I did not believe hydrogen fuel-cell vehicle (FCV) sales, and in particular, used car sales would prove to be as good as they have been. I decided to track used Toyota Mirai sales because I wanted to see the market for non-subsidized and no free fuel incentives. To this end, I decided to track Mirai sales on three popular used car web sites, Cars, KBB/AutoTrader, and AutoList. I started about the second week February 2019

The Mirai has been on the California market since October 2015, so this is long enough for the typical three-year lease to have expired and these cars show up on the used car market.

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As the above chart shows, FCV sales rose to a peak of almost 2,400 per year in 2017 and 2018 and have shown a slight decline in 2019. Credit carsalesbase.com and cafcp.org for new car data. As mentioned above, FCV sales are heavily subsidized both at the factory level (by the Japanese government) and sales in California ($5,000 state and $8,000 federal incentives). California taxpayers also pay for the 46 hydrogen fuel stations at about $700k per pump. In addition, all new FCV sales or leases come with three years of free fuel to take the sting out of the high price for hydrogen fuel.

A little explanation about EPA fuel economy figures. The MPGe “equivalent” is not based on cost, but on energy content. Roughly 1kg of H2 is equivalent to 1gal of gasoline. So when you read that the Mirai has an MPGe of 66, which sounds pretty good, consider that H2 is about $16/kg vs gas in California about $3/gal. So three years of free fuel is a big deal.

It turns out Toyota dealers get a three-year free fuel card from Toyota for each “Toyota Certified” used Mirai, and a large majority of Mirai sales are by Toyota dealers vs independent used car dealers or other manufacturer's dealers. Not all Mirai sold by Toyota dealers get the “Toyota Certified” treatment, but those that do generally sell for about $5k to $10k more than used Mirai from other dealers. I did not realize this until recently, so I did not record which cars were Toyota Certified.

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As you can see from the Mirai Used Car Sales chart, the average selling price has declined from $22,721 in February to $17,109 in December 2019. Now, I do not know the actual selling price, as this is negotiated between the dealer and the customer. The prices I list are the last asking price before the car was de-listed from the websites I monitor, so actual prices are probably lower.

I don't have a good explanation for the large spike in October sales, but back in August 2016, there was a major push by Toyota that resulted in 371 Mirai sales/leases vs more typical 70 sales per month at the time. I assume this contributed to a record 60 used Mirai added to the market in October 2019 and the salespeople managed to move most of them. December beat October's record by adding 76 more to the market and again the salespeople have risen to the challenge.

So what have I learned from this?

 

I didn't think that so many people would want to buy a car with $16/kg fuel cost even if it was environmentally benign considering the battery-powered alternatives like the Bolt that can be purchased for about the same price. Are these customers all Toyota stalwarts? I think so, as some people become very brand loyal, and for those who would never consider a non-Toyota, this is a flagship product with zero pollution.

A little more about my personal bias. I have nothing against the fuel-cell as a technology, I think it is a great invention. But, I dislike the fact that the oil companies who are the beneficiaries by being able to sell their zero-pollution product vs electrical companies are not paying for the infrastructure to distribute and pump hydrogen fuel themselves. Instead, oil companies have powerful lobbies in various governments that have persuaded mostly Germany, Japan, and the USA to fund auto fuel-cell research, manufacturing, and hydrogen distribution. And, of course, it is just much more expensive than the battery alternative, or at least would be without the free fuel cards being handed out.

I expect the downward trend to continue, as I am sure Toyota is losing money on this venture even with all the incentives. My biggest hope is that this will die before the governments spend even more taxpayer money on installing large numbers of H2 fuelling stations. I am sure FCVs will die eventually and this will be seen as a wasted investment.

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