Toyota to rev up hybrid production

23 May 2008 02:56pm

Toyota is building a 20 billion yen plant (£96 million) in Japan to produce batteries for gas-electric hybrid vehicles, as it seeks to keep its lead in an intensifying race for green cars set off by soaring fuel prices.

Toyota's joint venture with Matsushita Electric Industrial Co, which makes Panasonic brand products, is building the plant in Shizuoka prefecture, in central Japan, Toyota spokesman Paul Nolasco said.

The plant will produce nickel-metal hydride batteries, now in the company's hit Prius hybrid and other Toyota hybrid models.

The Nikkei, Japan's top business daily, reported that Toyota was building another plant in Japan to make lithium-ion batteries, set to be running by 2010, for future ecological cars. Nolasco said no decision has been made on such a plant.

Japan's top car maker, which leads the industry in gas-electric hybrids, has said it will rev up hybrid sales to one million a year sometime after 2010. The battery joint venture, Panasonic EV Energy Co, is 60% owned by Toyota and 40% by Matsushita.

Hybrids reduce pollution and emissions that are linked to global warming by switching between a gas engine and an electric motor to deliver better mileage than comparable standard cars. But they are still a niche market.

The Prius, which has been on sale for more than a decade, recently reached cumulative sales of one million vehicles.

Lithium-ion batteries, now common in laptops, produce more power and are smaller than nickel-metal hydride batteries.

Toyota has said the lithium-ion batteries may be used in plug-in hybrids, which can be recharged from a home electrical outlet.

Rebecca Lindland, an industry research director at Global Insight, said hybrids are increasingly attractive in the US, which had in the past favoured pickups and other fuel guzzlers, as fuel prices surge, environmental concerns grow and tougher emission standards kick in.

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