Piaggio to Unveil Hybrid Scooter

By LUCA CASIRAGHI
MILAN -- Europe's largest scooter maker by sales, Piaggio SpA, will launch the first-ever hybrid electric-and-petrol scooter on Tuesday, joining the race to manufacture fuel-saving vehicles of all kinds.
The Italian-based company, which controls 25% of the European scooter market, launches the three-wheeler in Rome Tuesday, to be rolled out across Europe by August. The company plans to sell the vehicle in the U.S. by 2010, taking advantage of 10% tax credit for plug-in motorcycles, beginning in January 2010.
The move makes Piaggio the first company to sell a hybrid scooter, but experts say it may be only a matter of time before its bigger rivals, Honda Motor Co. and Yamaha Motor Co come up with their own -- they've already presented prototypes of both hybrids and electric scooters. That could create stiff competition in the U.S., still a key vehicle market, but a small scooter market, where Piaggio is mostly famous for its Vespa.
"Piaggio has a head start over its competitors, but they may soon close the technology gap, as the hybrid scooter market is new," said Matt Mattila, hybrid engines expert at the Rocky Mountain Institute.
Still, Piaggio may have an advantage because its market is mainly among urban users and both Honda and Yamaha brands "are connected to an image of speed and high-performing motorbikes," said Manfredi Ricca, business director in Italy at the branding firm Interbrand.
An update of the company's MP3 three-wheel model, an innovative scooter marketed since 2006, the hybrid scooter costs €9,000 ($12,581) -- significantly more than its petrol-only competitors.
The company designed the three-wheel scooter to make it more stable in Italian traffic, and the model is more suited to the hybrid because, given the size of the petrol and electric engines, it still has room for storage.
The hybrid technology is a strategic investment for the company, which could be used in different vehicles and whose benefits will pay off over time.
"The technology developed for the MP3 may be soon applied on other vehicles with similar needs," said Roberto Colaninno, Piaggio Chairman and Chief Executive, at an event Friday.
The hybrid MP3 will be the first vehicle to use a lithium battery, which lasts longer between charges than do first-generation batteries, such as the Toyota Prius battery. Piaggio will start selling the hybrid MP3 mounting a 125 cubic centimeter, 11 Kilowatt gas engine with a 2.6 Kilowatt electrical system. The company said it wouldn't rule out using the hybrid engine in its more powerful MP3 models.
The battery charges while riding in the petrol mode. The scooter also can be plugged in to normal house electricity sockets and is fully recharged in three hours.
Write to Luca Casiraghi at luca.casiraghi@dowjones.com