Honda’s development of new energy vehicles with a focus on biofuels and electromotive vehicles

2. Honda’s development of new energy vehicleswith a focus on biofuels and electromotive vehicles Michio Shinohara Apr.21, 2010 Environment & Safety Planning Office Honda Motor Co., Ltd.

3. Products of Honda Mobility

4. Honda Business Overview 23 million customers a year in the world Global Sales of Honda Products ( million ) ：Others 25.0 ：Cars ：Bikes 20.0 15.0 10.0 5.0 0 2000 2003 2004 2005 2006 2007 2008 2009

6. Current Status of Mobility

7. Transport Characterization ■GDP per CAPITA vs PKT (People Km Travel) 1000000 100000 10000 HAM WEU PAQ LAM EFU FSU MEA AFR SAS PAS CPA PKT (pkm) 1000 100 100 1000 10000 100000 1000000 GDP per Capita (US$ ’85eq) As income increases, people select transportation that can take them faster and further When income increases, Travel distance expands ■GDP vs Transportation 100 80 BUS 60 Modal Share (pkm),% 40 car 20 AIR RAIL 100 1000 10000 100000 GDP per Capita (US$ ’85eq) With wealth comes a desire for freedom of mobility and a desire to travel

8. Current Level of Mobility There is a big difference in mobility by region North America Europe Japan, Oceania India Pakistan China, Central Asia Kenya, South Africa Most of the world’s population has not yet gained the benefit of mobility But wealth is growing

9. Economic Development and Growth of Automobile Use UIO Forecast (units in operation) Source: WBCSD, 2004SMP. Will increase to 1.3 billion units by 2030 2.0 billion units by 2050 Economic Development in the developing countries will treble the UIO

10. Technological Pathway In Honda's view the energy and environmental challenge involves three Critical Issues Developing alternative fuel technology (vehicles and infrastructure) to address energy sustainability Energy Sustainability Further advancing fuel efficiency through conventional engine hybrid and other technologies ③ Climate Change Escalation of Issues ② Reducing air pollution with conventional engine technology Air Quality ① Today present future past “Blue skies for our children”as the guiding force of Honda’s efforts

11. Honda’s 1stChallengeFor Air Quality ( Internal Combustion Engines ) “Blue skies for our children”as the guiding force of Honda’s efforts

12. Honda's First Challenge Honda Civic the first vehicle to meet the requirements of the 1970 U.S. Clean Air Act. More than 35 years ago, the concern about global pollution problems first began to gain attention. First CIVIC CVCC Engine publication “Blue skies for our children”as the guiding force of Honda’s efforts

13. Evolution of Gasoline Vehicle Emission Standards In 30 years 1 1000 Honda Civic CVCC -First to meet the 1970 U.S. Clean Air Act 11 (7 Mode) 3.4 1.5 HC standard (g/mile) California :Advanced TechnologyPartial Zero Emissionvehicle 1.0 Tier 0 0.41 Tier I EURO4 0.25 0.16 SULEV 0.01 1960s 1972 1975 1980 1993 2005 2007 - Year

14. Honda’s 2ndChallengeFor Climate Change “Blue skies for our children”as the guiding force of Honda’s efforts

15. Social Trend of CO2 Concerns

16. Global Average Atmosphere Temperature Glacier Upsala , Patagonia, Argentine 1928Copy Right: Archivo Museo Salesiano Glacier Upsala, Patagonia, Argentine 2004Copy Right: 2004-Beltra deg C +0.5 0 1950 1990 2000 Year Transition of ave. Temperature ( 1961~1990 ) + 0.5ºC 0.5 0 - 0.5 Red: measured by thermometerBlue: measured from tree, coral and ice sheet - 1.0 Source : IPCC TAR 1000 1200 1400 1600 1800 2000 In recent 100 years, the atmospheric temperature has been increasing rapidly, because of a large increase in CO2 from the consumption of fossil fuels

17. IPCC* 4th Assessment Report (2007) 2℃ 450ppm *IPCC=Intergovernmental Panel on Climate Change CO2 reduction plan based on the scientific basis proposed to the policymakers • Warming of the climate system is now unequivocal. 2. Most of the observed increase in globally averaged temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic (human) greenhouse gas concentrations. 3. The reduction plan of greenhouse gas has been proposed to policymakers. Reduction by half 2050 Target: Reduction by half by 2050 (CO2 concentration 450ppm+2 degrees C)

18. Economic Development and Growth of Automobile Use UIO Forecast (units in operation) Source: WBCSD, 2004SMP. Will increase to 1.3 billion units by 2030 2.0 billion units by 2050 Economic Development in the developing countries will treble the UIO

19. Why we need to accelerate electromotive technologies ?

20. Honda’s Visions for Reducing CO2 Emissions Reducing CO2 emission from vehicles : Shift to electromotive technology as one of the most effective ways to reduce CO2 emissions ・ Hybrid Car • Produce affordable hybrids within normal car prices • Improve the performance of hybrid system by maximizing the potential for internal combustion engine & hybridization • Recapture near all the braking / slowing energy for latter use ・ Fuel Cell Vehicles • Reduce the cost of FCV’s and infrastructure • Improve the awareness and understanding for consumers ・ Battery Electric Vehicles • Match current driver quality expectations • Deliver a reasonable range • Dramatically reduce cost • A renewable electric power source

21. Power Source of Mobility In the Future Since Karl Benz Motorwagen in 1885 Electric Motor Propulsion Internal Combustion Enginehas been dominant for over a century Fossil Fuel(Finite resource) To be replaced by • No emission, No pollution • Quiet and comfortable • Torqueful and smooth Battery EV(BEV) and FCV are both EV. BEV uses Battery as storage, whereas in FCV, FC stack works as an onboard generator. Exhaust It will take a long time to switch. For the time being, half ICE, half electric = Hybridwill be the main stream.

22. Environmental Technology: Evolution Direction Honda CO2 Reduction Technology Alternative Fuel Technology Decrease IMA Hybrid Technology CO2 Reduction Clean diesel i-DTEC Petrol Engine Technology i-DSI C V T i-VTEC VTEC-E i-VTEC+VCM i-VTEC ～ ～ 1990 2000 2010 2020

23. Diesel Engines

24. Honda’s Diesel Application in Europe ’06 beginning Honda diesel series is expanding in the EU DPF system also has been launched 2006 ’05/Sep CIVIC ’05/Jul CR-V (with DPF) ’05/Jan FR-V ’04/Jan CR-V ’03/Nov ACCORD WAGON ACCORD

25. Diesel Emissions Achievement Level 0.025 0.02 -75% 0.015 0.01 0.005 0.00 0.05 0.1 0.15 0.2 0.25 0.0 (g/km) -85% A big reduction is required to achieve the same levels as petrol (g/mile) (g/km) EURO IV or NZ’s current standard level 0.04 0.03 Production Model DPF system PM Combustion improvement 0.02 LNC system BIN5 J Post New Long Term 0.01 EURO V 0.00 0.2 0.4 (g/mile) 0.1 0.3 0.0 NOx

26. Electric Vehicles

27. Honda’s Vision for Electric Vehicles <Battery electric vehicles> <Electric Motorcycle “EV-neo”> Plan to lease sale in Japan from Dec.2010 2009 EV-N Compact city commuter 1997 EV-Plus Leased in Japan, U.S Hello! “Honda Electric mobility Loop” FCX Clarity -Fuel cell electric vehicle EV-Monpal EV-Cub U3-X EV-N

28. Hybrid Vehicles

29. Honda Hybrid Vehicles 2010 2nd 2009 2005 1st 2004 More than 488,000units sold (Insight 151,000 units sold) *as of Mar.2010 2002 1999

30. IMA Concept Integrated MotorAssist The world best environmental performance with advanced technology Take high-dimensional balance of low fuel consumption and driving comfort by making engine a main power while assisted by motor. Engine INTEGRATED MOTOR ASSIST Motor Transmission A simple, light-weight, compact Hybrid system

31. IMA System Simple, Lightweight, Compact Integrated Motor Assist (IMA) Clean & Green CO2 emission 101 Powertrain g/km • 1.3L i-VTEC <VCM> Fuel Consumption 4.4 • CVT designed to match high-output engine L/100km Integrated Motor Assist (IMA) • High-output, ultra-thin brushless motor • Intelligent Power Unit (IPU) ・High-output nickel metal hydride battery ・Battery box with Power Control Unit (PCU)

32. Ecological Drive Assist System 74 F To improve Fuel efficiency / lessen CO2 emission Clean & Green • ECON Mode Control of: ECON Button • Engine • CVT • IMA assist and regenerative braking Supporting fuel-efficient driving • Air conditioning • Cruise control Eco Assist™ Ecological Drive Assist System • Guidance Function Color of Speed meter background changes More fuel efficient • Scoring Function ECO GUIDE More fuel efficient

33. NEXT ERA TRANSPORTATION Clean & Green Usability Fun Affordable

34. Outlook of Hybrid Vehicle for the future Over middle class Hybrid model with the new system under development FIT/JAZZ HYBRID 201X ?? 2010 2010 Expanding small Hybrid models with the Honda’s original Hybrid System (IMA: Integrated Motor Assist) 2009 Over 150,000 units sold in Japansince its launch

35. Fuel Cell Electric Vehicles

36. Theory of Power Generation of Fuel Cell O2 Oxygen H2O Water Cell H2 Hydrogen Electrolyte membrane Electrode Layer Diffusion Layer Separator E Electron MEA (Membrane Electrode Assembly) Thickness：couple hundreds mm

37. What is a Fuel Cell Electric Vehicle? Generate electricity with hydrogen and oxygen by fuel cell battery and run by motor Only by-product is water, Zero-emission vehicle Oxygen Hydrogen tank Electricity Motor Fuel Cell Water Wheel Motor Torque Electric Power Hydrogen Hydrogen tank Fuel Cell Water Oxygen

39. Actual Usage of FCX Clarity ●Delivery in Japan : Government offices, companies, taxis ●Delivery in U.S : Private customers (mainly southern CA) Santa Monica St, CA Hydrogen station in US: Same as normal petrol, refuels by customer by him/herself Irvine St, CA,

40. Principal Specifications US model 4,845x1,845x1,470 mm 100 kW (136ps) Dimensions Maximum motor output 1630 kg 256 Nm (26.1kg・m) Weight Minimum motor torque 160 km/h Maximum speed Energy storage Lithium-ion battery 288V 620 km 171 L/ 35Mpa Driving range Hydrogen tank volume 3-4 minutes 100 kW Fuel cell stack output Refueling time Honda in-house data for US model

41. Does the Cost Really Drop? Cost transition of Air bag 1/10 Production 200 times Cost 10 years Cost reduction target of fuel cell vehicle 1/100 Cost

42. Honda’s 3rdChallengeFor Energy Sustainability “Blue skies for our children”as the guiding force of Honda’s efforts

43. Alternative Fuels

44. Flexible Fuel Vehicles

45. Ethanol Fuel (including Bio-Ethanol) 100% 10% 20% 25% 100% E100 gasoline ethanol 0% Flexible fuel vehicle (FFV) system that enables gasoline engine-based power plants to operate on either 100% ethanol or a wide range of ethanol-gasoline fuel mixtures was launched in Brazil in 2006

46. Bio-Ethanol

47. Cellulosic Ethanol Research The edible part of food is not exploited Cellulose CO2 Cellulosic ethanol Ethanol Proof at carbon neutral cycle and proof of social adaptability

48. Production Process of Bio-Ethanol CH2OH CH2OH CH2OH H OH O O O H H H H H H H H OH OH OH H H OH OH H H OH OH OH OH H OH H H H OH OH O H H OH OH CH2OH H OH New RITE-Honda manufacturing process Separation Saccharification Ethanol conversion Edible part by microorganisms Ethanol C2H5OH Cellulose Inedible part RITE Bioprocess Foodstuffs Conventional process (Brazil, USA, Sweden…) Extraction ofsugar/starch Ethanol fermentation Oil Protein Saccharide Starch Ethanol C2H5OH Corn / Sugarcane Glucose / Oligosaccharide

49. Hydrogen

50. Home Energy Station ～ ～ ～ ～ ～ Supply Hydrogen for Fuel Cell Vehicle Supply heat and electricity for home Hydrogen production capacity: 2Nm³/h maximum Hydrogen storage capacity: 132L Power generation capacity: 4kW or more heat Fuel cell Inverter ～ electricity Reformer Natural Gas Purifier Storage tank Fuel CellVehicle Compressor