So here’s the deal. A technology company called Torotrak has developed a revolutionary automatic transmission system for automotive applications that yields a substantial fuel economy improvement – and corresponding CO2 emissions reduction – over standard stepped ratio manual and automatic transmissions. Torotrak is licensing the technology out and there is significant interest and evaluation work from OEMs and Tier 1 transmission makers, but no-one has yet announced plans for volume production. What happens next? Dave Leggett reports.
Go deeper with GlobalData
Torotrak is a technology company based in the UK with a simple to define – less simple to execute – goal: to bring its revolutionary and patented automatic gearbox technology to the automotive market. According to the company, its Infinitely Variable Transmission (IVT) brings fuel economy gains without performance compromises.
They’ve produced – at considerable cost – a working prototype for themselves and that seems to have succeeded in getting them a good press; engineers and journalists are largely impressed with IVT (if not the Ford Expeditions it is being demonstrated in). A slew of production and evaluation licenses are in operation amongst vehicle makers and transmission makers.
As for investors in the company, it’s a classic ‘jam tomorrow’ proposition: when (or if) the automotive industry catches on to the benefits of IVT and toroidal transmissions are produced in big volume, Torotrak rakes in the royalties. But many investors are still hurting from the downward slide in the Torotrak share price that took hold in 2000 – largely a reflection of blanket negative sentiment towards hi-tech stocks. And recovery has certainly been blunted by the sensitivity of the share price to anything that can be construed as negative news. Nevertheless, many of Torotrak’s army of small investors (the institutions seem to be keeping away) retain a near fanatical belief in the technology, its benefits and the probability of commercial success. The market just has to ‘catch up’. A case of ‘when not if’? It’s not quite that simple.
Progress so far? That’s an interesting one. On the downside, Torotrak still lacks – despite all the hard work – the final commitment from someone in the auto industry to fit its IVT in a production vehicle. The company’s roller-coaster share price reflects the high risks present (from a one-time peak of 600p a share to around 32p now). There’s still plenty of money in the bank from the 1998 flotation on the London Stock Exchange, but it obviously won’t last forever. The company makes annual losses (lower now that they’ve completed the Series 3 prototype investment work). At its current rate of spending (about £4 million per annum) it will drain its reserves (already down to around £20 million) in five years.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataNo need to panic yet, but investors are understandably anxious for news of a production deal. If one OEM takes IVT, confidence will rise (along with the share price). Also in the negative column, Toyota has apparently rejected the technology (although it probably has its own plans and retains a connection via Aisin AW) while GM said the technology is ‘concept ready’ but could someone else please come along and fund putting it into production.
It could be added too, that the competitive environment for IVT is not standing still. Rival transmission systems are becoming more efficient. And then there’s the fuel cell question. Torotrak makes the ICE more efficient. If fuel cells take off in a big way and earlier than expected, the effect would be to reduce the aperture of the IVT opportunity window. But fuel cells are some way off and as the Torotrak people are keen to point out, ICE retains a huge share of the market versus alternative powertrain technologies for a long way out into the future (‘conventional powertains to dominate for a minimum of 30 years’). Few would disagree strongly with that assessment.
On the upside, IVT’s time may be coming as vehicle emissions regulations tighten, especially in the US. The fuel economy benefits presented by IVT may increasingly play well with consumers, as well as manufacturers. And Torotrak has identified the North American light truck sector as a key market opportunity. Europe could become more significant too as automatics take share from manuals.
Also there is evidence that the technology is being taken seriously in the industry. While the OEMs are apparently displaying reluctance to invest in the technology themselves, the major Tier 1 transmission companies are looking closely at IVT. Torotrak maintains that such a development is part of a broader industry trend and that the OEMs want a specialist Tier 1 to develop and bring the concept to production (and bear costs and risk) – at relatively low volume to start. Certain OEMs are more cautious and more risk-averse than others. Some set some store on a reputation for innovation. The hoped for breakthrough could be with an OEM innovator. Torotrak’s IVT in the next generation BMW 7 Series via Getrag? A not altogether implausible scenario perhaps, but you won’t be browsing the manufacturer brochures for IVT fitment anytime soon – the development work for volume production makes that at least four years away.
What is toroidal IVT and how does it work?
Well, manual and conventional automatic transmissions operate by a series of fixed ratios (normally 4 or 5, though 6 is becoming more common) and the engine power is transmitted to the wheels via a clutch (or torque converter). Fixed ratios mean that the engine is often running inefficiently (in terms of economy and performance) because the range of loads and speeds required at the wheels is calibrated to engine output via the fixed ratios. Therefore, the engine is rarely running at the optimum level for the performance demanded.
The addition of Continuously Variable Transmission (CVT) or Infinitely Variable Transmission (IVT) allows the engine to run more efficiently on the engine map, the transmission making sure that the right ratio is selected.
In the case of IVT, the ratio is derived via a mechanism called the variator and the transmission remains connected at all times to the engine. It uses an epicyclic gear system to compound two drive paths – one of which passes through the variator. The variator uses a group of rollers squeezed between two pairs of toroidal shaped discs. Each pair forms a hollow doughnut shape (‘toroid’). The rollers transmit power from the input discs to the output discs – in the centre – via a traction fluid (made to an exacting specification; Torotrak says it will last for life though). Each roller is connected to a hydraulic piston and as the roller moves it pushes against the discs, creating a change in torque and speed.
 |
Fig 1: 3D image of IVT layout – variator and rollers clearly visible at the back |
The toroidal shape means that as the rollers move and change angle within the variator they steer across the discs without losing contact. The IVT produces a spread of ratios from full reverse to high overdrive without the need for a coupling device or a reversing mechanism (which also yields an interesting hill descent technique involving the engagement of reverse and descent determined by the mass of the vehicle and gravity – put your foot on the accelerator and you go back up the hill; IVT can apply torque in the opposite direction to vehicle movement).
The linking of the engine with the transmission is under continuous microprocessor control which means there is a fair degree of latitude to give the driving experience an appropriate ‘feel’ (for example to reflect different driving styles in different markets). Through the hydraulic system, the driver directly controls the work produced by the road wheels and the gear ratio is produced automatically.
The epicyclic gearset and the variator provides a low range set of gears for low speeds and reverse, while a higher range is available for higher speeds with all engine power going directly through the variator. The spread of ratios goes up to high overdrive, a particularly fuel-efficient area of operation. In the IVT-equipped Ford Expedition, high overdrive meant around 1,200 revs at approximately 80 mph (you don’t need much torque to maintain cruising speed).
Certainly the Ford Expedition driving experience was smooth and the high overdrive kept the noise down at high speed. Progress was smooth and I couldn’t hear anything untoward – though some said there was a slight whistling sound from the pump that circulates oil round the transmission. If there are any slight glitches on the prototype – and they would be slight on the basis of my and others’ experience – I would expect them to be ironed out on a production version.
IVT benefits?
Besides the basically smooth driving experience, some handling gains and a programmable electronic control regime suitable to different driving modes and styles, the major benefit that IVT offers is improved fuel economy and lower CO2 emissions. Torotrak’s extensive research suggests that the fuel economy improvement is of the order of at least 15% over the performance of conventional manual or stepped ratio automatic gearboxes. Against certain types of vehicle (eg conventional four geared auto box fitted to a Ford Expedition) the IVT fuel economy gain is put at around 20%.
Torotrak also maintains that there are also other benefits inherent in the IVT design that can accrue to manufacturers, including ease of manufacture, a relatively light weight and a common technology base (IVT is scalable; one of the licensees is a heavy duty truck manufacturer).
Torotrak’s long and winding road to market
In attempting to appreciate Torotrak’s current position and strategy, a little history by way of context is helpful. Amazingly, the first patent for a toroidal CVT was filed at the end of the 19th century. Automotive applications began in Britain with Austin in the 1930s and industrial consolidation eventually left that technology with a British company called BTG. CVT technology was licensed to Lucas Aerospace and used in the Harrier VTOL fighter and in the 1970s British Leyland (Rover’s forerunner) became interested in the technology. In 1987, Rover Group’s engineers working on the project moved to BTG and a year later BTG formed a subsidiary company, Torotrak.
In 1994, Ford became Torotrak’s first major licensee and work on incorporating Torotrak transmissions into Mondeo models took place.
In 1998, Torotrak demerged from BTG via flotation on the London Stock Exchange – raising £50 million in the process. Product launch was planned for the middle of the following decade and the stated target was 80% penetration of the global automatic market by 2010.
Besides Ford’s heavy early involvement, Torotrak then secured a number of licensees on a mixture of technology license arrangements, some evaluation-only and some with production options. These included both OEMs and Tier 1 transmission manufacturers. The OEM strategy took a knock – along with the share price – when Toyota (November 2000) and GM (January 2002) subsequently pulled out.
 |
Fig 2: Series 3 IVT prototype has been fitted to Ford Expeditions |
Toyota cited vibration and ‘unacceptable drivability’ on the IVT-equipped vehicles it tested. But Toyota chose to do things their own way, rejecting Torotrak involvement and Torotrak says that militated against engineering rectification in this case. Certainly the driveability of the Series 3 IVT in the Ford Expedition makes Toyota’s complaints look odd and raises questions about what Toyota’s own engineers might be up to.
After the Toyota blow came the GM setback (bad news/good news – but the market decided bad news overall). GM decided that – following extensive testing of IVT in a Chevrolet Silverado – it did not want to take IVT into production itself and would not take up a production license. At the same time it said, apparently paradoxically, that IVT itself is ‘concept ready’.
The emerging Tier 1 strategy
Torotrak appears to have concluded that the best strategy for getting IVT into volume production is via specialist Tier 1 transmission makers. Some of the larger OEMs appear to be unprepared to bear the development costs and risks involved in developing certain new technologies for production. Torotrak themselves acknowledge their frustration in encountering industry inertia. The OEMs, they say, are more interested in introducing new technology at the premium end of the market and in niche volumes, at least to start with.
Therefore, a specialist transmission maker ought to be well placed to develop IVT for production at relatively small volume for OEM customers to try in certain vehicles. Once initial market acceptance is achieved the argument goes, the market moves more decisively in the IVT direction and penetration increases.
The significant Tier 1 licensees include Equos, the research and development arm of Aisin AW (the largest supplier of automatic gearboxes in Japan and 41% owned by Toyota), and Getrag, a supplier to BMW. Koyo Seiko – a bearings maker with a possible role in large-scale variator manufacture – is also a licensee. Torotrak maintains that Equos have had their ‘initial targets’ met in their evaluation programme.
Earlier this year Torotrak also announced that a license agreement has been signed with European transmissions maker, ZF. All of these evaluation processes are positive developments, but the breakthrough to production still looks some way off.
So, what happens next?
There can be little doubt that Torotrak needs the IVT production commitment breakthrough soon. Doubts over what appears to be a fundamentally ‘good idea’ that is having trouble converting into commercial viability will intensify otherwise. Torotrak says that progress is being made in discussions with Ford and it would appear that those discussions are now mainly surrounding commercial rather than technical matters.
A decision by Ford on whether or not to proceed further cannot be far away. Torotrak says that another OEM besides GM has said that IVT is ‘concept ready’ but won’t reveal their identity. It will also be interesting to see what progress is made in the Tier 1’s evaluations (and one or two of them may be being actively encouraged behind the scenes by an OEM). Ford, Equos, ZF, Getrag. Look for any announcements involving these companies and Torotrak’s IVT technology over the next six months. Some indication of progress – or not – should be evident over that timescale.
|
Taking a broad view, IVT’s timing could be ideal – in theory. If IVT market launch is in 2005 (and not much further out) that suggests a pretty good opportunity for IVT given that the ICE is going to be with us for some time yet. Several studies have suggested that advances in gasoline and diesel engine technology will keep these powertrains competitive for at least another twenty years (Torotrak reckons that fuel cells will have just 10% share in 2020). The regulatory environment seems to be moving in the right direction too; IVT could – perversely perhaps – actually help certain manufacturers retain product mix (hang on to those big margin light trucks) in the face of tougher emissions rules. It is no accident that the Series 3 prototype has been fitted to a small fleet of Ford Expeditions. Also, Europe is surely ready to see a surge in automatics towards the levels seen in North America and Japan. Could be a big market opportunity there.
The people at Torotrak certainly exude plenty of confidence. The company has spent around £15 million of its original £50 million flotation, developing the Series 3 prototypes itself, but has at least been able to demonstrate driveability to the wider world. The IVT prototype clearly works. There is still £20 million in the bank and spending is now put at around £4 million per annum. The development work that Torotrak’s engineers are conducting alongside license partners is at least not imminently threatened by diminishing financial resources.
Other potential competitor systems to IVT, like Nissan’s half toroidal CVT, appear to offer fewer benefits than IVT. But the world is not standing still and waiting for IVT. The IVT ‘edge’ is probably as large now as it will ever be.
Torotrak has a near fanatical following of small investors, many of them engineers. They are understandably restless for a production deal from somewhere. They can at least rest assured that marketing is being given top priority now (a development not entirely unrelated to the recent early retirement of CEO Maurice Martin – a sales and marketing oriented replacement is being actively sought). But this IVT adventure is not quite a dead cert and however interesting the technology appears, commercial success is what counts. It could actually be closer than it appears at first sight, but until Torotrak has some commitment to put IVT into production chalked up, it is basically a loss-making technology company with uncertain prospects. No-one ever said innovation was easy.
