Hybrid Aims to Stay Top Emerging Format

By JOHN MURPHY
DETROIT -- Electric vehicles may have stolen the spotlight at this year's Detroit auto show, with many of the world's top auto makers promising to charge into the future with lineups of flashy, emission-free green cars. But Toyota Motor Corp. and other auto makers are seeking to ensure that gasoline-electric hybrids remain the dominant ecocar in the years ahead.
Toyota is unveiling two hybrids at this year's auto show: the third generation of its top-selling Prius and the Lexus HS250h, a luxury vehicle that will only be available as a hybrid. The company also said it will introduce 10 more hybrids by early next decade, part of its goal to sell one million hybrids a year by that time.
Once ridiculed as impractical, too expensive or a gimmick by other auto makers, the Prius is spawning a fleet of competing hybrids at this show.
European Pressphoto Agency
Honda Motor Co. introduced its new Insight, a four-door hatchback that it is marketing as the first "affordable" hybrid. Ford Motor Co. showcased its new Fusion hybrid, which is due later this year, and South Korean auto maker Hyundai Motor Co. displayed its own hybrid technology that it plans to make available in 2010.
Toyota has dominated the hybrid market with more than a 70% market share in the U.S. "We've been pushing the notion of hybrids kind of by ourselves," said Jim Lentz, president of Toyota Motor Sales USA, in an interview. But new competitors will help the technology gain traction in the mass market, he said.
To be sure, many auto makers believe consumers are ready to leap from gas-electric hybrids to pure electric vehicles. Ford, Chrysler LLC and General Motors Corp., as well as smaller players such as China's BYD Co. and start-ups Tesla Motors LLC and Fisker Automotive Inc., all displayed electric vehicles that generated buzz at the North American International Auto Show on Sunday.
Even Toyota hedged its bets on hybrids by unveiling its own electric vehicle at the show: a small, two-door electric concept car that it plans to introduce in 2012.

But the future for electric vehicles remains vague, despite the initial enthusiasm. Most electric concepts shown here still depend on breakthroughs in battery technology, have high production costs and aren't guaranteed to be a success with consumers, who would need to adjust to recharging their vehicles.
By contrast, hybrids have become accepted technology, requiring no additional infrastructure or change of refueling habits.
"While Toyota is investing heavily in advancements such as fuel cells, plug-ins and battery electric vehicles, we believe that the gas-electric will be our core technology for many years to come," said Irv Miller, vice president, environmental and public affairs, for Toyota Motor Sales USA.
In terms of sheer volume and detailed planning, Toyota is right. Initial production goals for most electric vehicles remain relatively small, with GM planning to produce about 60,000 of its highly anticipated Chevy Volt due out in 2010. Chrysler said it expects to start producing an electric car in 2010, one of four that the company plans to bring to market by 2013, though it offered few details.
Toyota, by contrast, is well on its way to reaching its goal of selling one million hybrids a year early next decade and has set a goal of offering hybrid versions of all its vehicles by 2020. Ford hopes the new Ford Fusion and Mercury Milan hybrids will help double its sales of hybrids to 40,000 a year.
Though sales of hybrids slipped in recent months as gasoline prices have plummeted, falling more than 50% in December, car makers are confident that high gas prices will return, helping to make hybrids a cornerstone of the auto industry.
"There is basically nothing out in the market today in terms of segment that doesn't have some hybrid associated with it. From the biggest vehicles at GM, to Ford and Chrysler to us -- you've got the hybridization of the internal combustion engine," said John Mendel, executive vice president of American Honda Motor Co.
Electric vehicles represent the next step, he said. The question is whether the industry is ready to take the step. Most auto makers are aiming to build powerful lithium-ion batteries to power their planned electric vehicles, but safety and durability issues remain.
Ford doesn't view its hybrids, plug-ins and pure electric vehicles as being in competition but part of a broad electrification strategy.
Chief Executive Alan Mulally said that Ford would bring its electrified vehicles to market "more quickly and more affordably" than its competitors. Unlike GM, which has pledged to bring its plug-in hybrid to market by late next year, Ford said that it will introduce a battery-only commercial van in 2010, followed by a passenger car built on the same technology in 2011. They would be followed by a plug-in vehicle by 2012.
The concept has long languished at Ford but has been consistently pushed by Chairman William Ford Jr., who took center stage at Cobo Arena to announce that the electrification strategy "is not a test program" but "a vital element" of the company's future product-development strategy.—Matthew Dolan and Kate Linebaugh contributed to this article.
Write to John Murphy at john.murphy@wsj.com