Toyota Motor Corp. said it has cut the cost of the fuel cell system in its next hydrogen-powered car by almost $1 million, putting it on course to launch a mid-sized sedan in 2015 with a price below $100,000.

The new fuel cell sedan will be sold in certain areas in Japan, the United States and Europe, Toyota said. It is set to unveil a concept model at the Tokyo auto show in November.

The carmaker says the fuel cell system will cost about 5 million yen ($51,000) compared with prototype costs of more than $1 million.

The company is betting on fuel cell cars, which convert hydrogen to electricity, emit only water vapor and have a similar range to conventional gasoline-powered cars, as the next-generation alternative fuel vehicle.

“We aim to sell tens of thousands of fuel cell vehicles a year by sometime in the 2020s,” Managing Officer Satoshi Ogiso told reporters earlier this week in Tokyo where Toyota showed off its advanced technologies.

Toyota engineer Hitoshi Nomasa said the company had cut its use of platinum, which sells on world markets around $1,380 an ounce (28 grams), from about 100 grams in the fuel cell of its current hydrogen-powered SUV model to around 30 grams.

The figure would come down more with improvements in platinum coating technology, Nomasa said.

Diesel catalytic converters currently use some 20 grams of platinum, Nomasa said, adding: “If we can bring it down to around there, then that would be about the same level of platinum being used in cars that are widely used.”

Toyota will also use less carbon-fiber in the high-pressure hydrogen tanks and will use cheaper, mass-produced components to cut costs, the company has said.

Unlike electric cars, whose range is often limited to 100-200 km and which need hours to recharge, hydrogen vehicles can refuel within minutes and travel distances similar to those of autos with conventional combustion engines.

But for fuel cell vehicles to take off, hydrogen refueling infrastructure needs to be in place and car prices must drop.

Toyota currently leases around 100 fuel cell SUVs to governments and local authorities in Japan and the United States, though they are not available to the general public.

Toyota is also working on a fuel cell vehicle system with BMW and has said it wants to introduce a new fuel cell vehicle around 2020 using the jointly developed technology.