Automotive dreams in the queue

In our lifetime we will witness the age of 100 mile-per gallon cars, lifetime headlights and taillights, streaming entertainment and information content, and cars that drive themselves. Actually, all this will be here a lot sooner than you think -- within the next few years.

Here's the stuff of automotive dreams, already on queue for production.

(Picture Top-Left: Mercedes Bluetec Engine)

Engines

Diesels are aiming to be the new hybrids. The problem is, diesel's used to be dirty engines and have had a hard time making any progress in the U.S. market. But new emissions technology solves that, giving these oil burners a clean bill of health in all 50 states.

The high cost of diesels is also coming down to more affordable levels. Look for these cleaner, more efficient diesel engines in the Jeep Grand Cherokee, Volkswagen Jetta TDI; Mercedes' E320, ML320 and GL320 BLUETEC models, Chevy Silverado/GMC Sierra 2500/3500 HD, Dodge Ram 2500/3500 and the Ford F-250/F-350/F-450. Also on the horizon is a diesel powered Honda Accord, set to debut in 2009, which is apparently capable of 52 mpg.

Hybrids are hot now (who's going to argue with 50 MPG?), but they'll be getting hotter as prices in this segment also come down.

J.D. Power predicts 345,000 hybrids will be sold in '07 -- a 35 percent increase over '06. Honda and Hyundai are gunning for the big mileage (and sales) numbers by dropping their smallest engine into their most lightweight chassis (a Honda Fit-sized car and Hyundai Accent respectively). Also look for large models, like the Chevrolet Malibu Hybrid and Saturn's Vue and Aura Green Linemodels to deliver modest fuel savings at practical prices and stylish packaging.

More exciting than both diesels and hybrids is a technology that has gone from theory to aluminum in the last couple of years because of advances in computer technology. HCCI, or homogeneous charge compression ignition (also see more on HCCI here http://www.autoblog.com/tag/HCCI) is a gas engine that acts like a diesel motor.

Like a diesel engine, gas inside the cylinder is ignited through compression and the heat generated by the engine itself. No spark plugs. The result? Diesel economy and efficiency at roughly half the weight and materials cost of a conventional gas engine with no need to treat the exhaust.

GM demonstrated two vehicles fitted with HCCI engines in August. Mercedes wowed crowds even more recently at the Frankfurt auto show with their DiesOtto implementation that merges HCCI technology with a mild hybrid module to produce 238 hp, 295 lb.-ft. of torque and 39 mpg in a vehicle the size of an S-Class sedan. Mercedes squeezed that performance from a 1.8-liter four-cylinder engine.

All of these technologies are stop-gap solutions until the most efficient answer arrives on our shores -- hydrogen. How soon? FreedomCAR, a partnership of the U.S. Department of Energy and the United States Council for Automotive Research, projects that hydrogen technology will be broadly available to the masses by 2015.

On the fuel cell side, Honda has indicated that their new FCX Concept will slide alongside the existing previous-generation FCX already on the road by 2008. GM's Project Driveaway is putting at least 100 fuel-cell powered vehicles in the hands of lucky testers this year, but the hydrogen-powered Equinoxes are not available for sale.

As for hydrogen combustion engines, small numbers are popping up as manufacturers like BMW (see the BMW Hydrogen 7) keep real-world testing and refining concepts, but there are no production plans as of yet. Obviously, both solutions face infrastructure challenges for refueling that are still being worked out.

Until the heady days of hydrogen power are realized, you still have radical alternatives to diesel and conventional hybrids if you want to drive green.

Internet reports abound of home-customized Priuses topping the 100 mpg mark with the advantage of enhanced battery packs and modified software keeping the cars running on electric power far longer than their stock counterparts.

Plug-in hybrids hold the potential to dwarf the fuel economy potential of diesels and hybrids, but cheeky price points, mostly from the cost of hefty battery packs, might be what are holding off production announcements from manufacturers. Not even a date can be pegged to the darling of poster boards, Chevrolet's Volt. While plug-ins are being researched and developed by major manufacturers like Toyota, Ford and GM, the impatient can check out a handful of small companies which offer plug-in conversion kits for hybrids, complete with instructions.

Or the impatient can skip the gas motor all together. The smooth exterior lines and booked solid pre-orders of the Tesla proved that the electric car is far from dead ... it's just pretty expensive.

Miles Automotive Group aims to change that. Their coming XS500, an electric midsize sedan, will arrive in the states in 2008 with a top speed of 80 mpg and a range of 120 miles. The price: $30,000. The XS500 could be joined by a $45,000 electric sport-utility truck and SUV from Phoenix Motorcars sometime in 2009. The SUV and SUT would start with a 130 mile range, a 0-60 time of 10 seconds and a top speed of 95 mph.

Additional models coming to U.S. pavement (or already there) include Zap's intriguing Zap-X, Wrightspeed's blazingly fast Wrightspeed X1, and the very affordable NmG from Myers Motors.

Entertainment

A survey conducted by TRG, Telematics Research Group Inc., reveals that nearly 70 percent of announced upcoming 2008 vehicles for sale in the U.S. will have a Bluetooth communications system either as optional or standard equipment. Navigation systems will be available in 80 percent of coming 2008 vehicles, according to the same survey.

We're at the point where digital entertainment storage systems like Microsoft/Ford's SYNC (See video of SYNC ) and Chrysler's MyGiG (see more on MyGig ) are about to go from super cool to everyday accessories like an iPod thanks to broad introductions that span the luxury segment to value-driven cars like the Ford Focus. What's the next frontier?

Streaming media is one. Supplier interviews conducted by the Center For Automotive Research (CAR) point to 2010 as the year when customized or on-demand content will be streamed to vehicles. That customized content could span the gamut from television programming and movies to important local updates, along with new, far more robust real-time traffic data through two-way communication.

Couple this trend with the fact that vehicle-based digital storage (handy for buffering downloads) will increase and drop in price, and you have a done deal. Almost: CAR notes that the challenge isn't displaying the content, but finding the bandwidth and compression necessary to deliver the programming.

A closer star on the horizon of coming entertainment is HD radio, which is popping up in cars by BMW and Ford this year, and will be added to, at least, the Jaguar XJ and Hyundai's Genesis for 2008.

Using technology licensed from a company called iBiquity Digital, HD radio promises to deliver AM radio in FM-quality sound and FM channels in CD-quality sound, along with accompanying data that will begin with artist, song and station information. Digital radio gives a broader frequency response to channels, transforms AM radio from mono to stereo, and allows for better stereo separation.

Check out (http://www.ibiquity.com/hd_radio/hdradio_experience) to hear the difference. Bob Struble, president and CEO of iBiquity sees next-generation HD radios offering users the chance to buy songs and advertised products or even bring TiVo-like qualities to the radio experience. iBiquity estimates that by 2008 more than 90% of the U.S. population will be reached by HD radio broadcasters.

Safety

The Lexus LS 460 is the first vehicle for sale in the U.S. that can park itself. Audi's dynamic steering system adjusts the driver's steering inputs when the vehicle senses that the handling limits have been reached, even making slight corrective inputs on its own when things are getting out of hand.

The Lane Departure Prevention System on Infiniti's new EX35 manipulates the brakes at individual wheels to help steer the SUV back into its lane when it senses an unintentional drift. Welcome to the brave new world of Active Safety 2.0, where your vehicle humbly offers assistance to keep you out of trouble, in addition to trying to save you when you're in it.

In 2005 General Motors announced that the 2008 Opel Vectra would be the first car to boast Traffic Assist, a system that allows the car to drive itself at speeds up to 60 mph -- even in heavy traffic. The system sees road signs, bends and other vehicles in the road to adjust the car's trajectory and speed according to everything going on around it.

As advanced and capable as the system may be, composed of processors, lasers and a video camera, it won't be offered for sale in the United States, but in Germany. Why? Two reasons: one, we live in the most litigious nation in the world. Two, we Americans, as a mass of consumers, aren't comfortable paying additional price premiums for the safety technology we crave -- we feel it should be included in the vehicle's price.

One coming revolution we'll definitely see is brake-by-wire technology. A brake-by-wire system replaces the hydraulic hardware of conventional brakes with faster-acting and more environmentally friendly electric motors and relays that should be more reliable and take up less space. We're already seeing conventional hydraulic systems get smarter with radar-based augmentations like Mercedes' Brake Assist Plus and Infiniti's Preview Braking by pressurizing the brake system earlier, allowing for a faster response and shorter braking distance when the driver decides to hit the pedal. A fully electronic braking system should further improve on stopping times and distances. Automotive News predicts brake-by-wire systems will surface in 2011.

Whether or not you purchase a vehicle with any, or all, of these trends one thing is certain ... automotive dreams do come true.



By Jon Gromer taken from CNN/AOL Auto

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Green is the word

LONDON, England -- The major theme of this year's early motor shows in Detroit and Los Angeles confirmed that "green" cars are finally credible in the U.S., in the wake of increased awareness of climate change and continued high fuel prices.

(Picture Left-Top: Hybrid taxis are unveiled in New York City. At Detroit's Auto Show earlier this year, U.S. automakers highlighted the latest technology in hybrid models)

While development of the hydrogen fuel-cell as the probable motive force of the future, the technology of the moment is the petrol-electric hybrid, in which a petrol engine and electric motors work in tandem.

The benefits are zero emissions when the car operates in electric-only mode, while the petrol engine can be smaller due to its electrical assistance. A smaller capacity engine also means less carbon dioxide emissions, while battery charging is taken care of by the petrol engine.

Drawbacks include greater complexity and weight, then there's the issue of making and disposing of the batteries, not to mention limited range in electric-only mode.

But industry analysts say that hybrids are just token models. The reason for their increasing popularity in the U.S. is due to the Corporate Average Fuel Economy (CAFE) regulations -- the average economy of a car maker's range has to be 27.5 miles per gallon. This means that if a manufacturer sells a hybrid capable of 60 miles per gallon, it is allowed to sell less efficient cars -- typically SUVs and trucks -- that only manage 20 miles per gallon.

California is the undisputed hybrid capital of the world, due to a commitment to low-emissions regulations. The Los Angeles show featured offerings from the world's big four manufacturers of hybrid cars; Ford, General Motors, Honda and Toyota. Nissan also joined the party, showing a hybrid version of the Altima saloon.

Ford showed its Escape Hybrid, America's first hybrid-electric vehicle and the most-fuel efficient SUV on sale, delivering 36 miles per gallon in city driving.

General Motors introduced two of the four hybrid models it is launching this year, the Saturn Aura Green Line Hybrid and the 2008 Yukon Hybrid. The latter is only the second GM vehicle to be marketed with GM's new two-mode full hybrid system, which uses an electrically variable transmission with two hybrid modes of operation that optimize power and torque for various driving conditions. The first mode is for low speeds and light loads, while the second is primarily for highway speeds.

This system is also the starting point for a collaboration between GM, DaimlerChrysler and BMW.

At Detroit, GM launched its Chevrolet Volt concept car, the first mass market prototype designed to operate purely using an electric motor.

The vehicle will be powered by new-style lithium batteries, charged via a domestic electricity socket.

It could also feature a range of supplementary power sources including an ethanol-based petrol engine and, eventually, hydrogen fuel cells.

The Volt can run in electric-only mode for up to 40 miles. In a daily commute of 30 miles it would deliver an equivalent fuel consumption of about 150 miles per gallon using ethanol.

Honda, which reached a milestone of 100,000 hybrid sales in August 2005, launched an all-new version of the popular Civic Hybrid capable of 49 miles per gallon in urban driving.

The Civic, and the larger Accord Hybrid, are powered by Honda's Integrated Motor Assist (IMA) hybrid technology which uses an ultra-compact electric motor/generator to provide supplemental power to the engine using energy captured during deceleration or braking.

Toyota is a sales leader with its Prius, which combines a 1.5-liter petrol engine and an electric motor to give economy in the region of 60 miles per gallon in urban driving. The larger Camry hybrid, with similar Hybrid Synergy Drive, delivers an EPA-estimated 40 miles per gallon in the city.

Its Lexus luxury division is offering the LS600h, the world's first full V8 hybrid. Although it's a large, luxury car, thanks to the assistance of an electric motor the 600h is claimed to deliver the performance of a V12 petrol engine with emissions 70 per cent lower than equivalent V8-powered saloons.

The all-new Nissan Altima Hybrid, Nissan's first entry into the hybrid petrol-electric vehicle segment, made its debut in Los Angeles. It features a 2.5-liter, four-cylinder engine and electronic Continuously Variable Transmission (eCVT) with an electric motor and generator that combines greater economy (an estimated 41 miles per gallon around town) with low emissions.

At Detroit, Mazda unveiled a hybrid version of its Tribute SUV, its first production hybrid vehicle, which goes on sale in the U.S. later this year. With a combined power output from its petrol engine and electric motor of 155bhp, the Tribute HEV meets both the strict Super Ultra Low Emissions Vehicle (SULEVII) and the Advanced Technology Partial Zero Emissions Vehicle (AT-PZEV) standards in California -- the world's strictest emission regulations for a petrol-engined vehicle.


By Paul Hudson taken from CNN

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Carmakers rush to jump on green bandwagon

GENEVA, Switzerland -- There was a distinctly green theme at this year's Geneva motor show, as manufacturers battled to prove their environmental credentials in a world that is increasingly concerned with the environment and man's effect on it.

(Picture Left: Honda's Small Hybrid Sports Concept shows it's possible to eco-aware will having fun.)

Although petrol-electric hybrid vehicles are seen as the interim technology to reduce fossil fuel use and emissions of carbon dioxide, the hydrogen fuel cell is still likely to represent the future of motoring.

Plenty of the former were on display at Geneva as the industry realizes that so-called "green" cars can sell.

Honda and Toyota are the mass-market pioneers of petrol-electric hybrids, and although their offerings might be constructed at a loss it is worth it in terms of marketing and a perception of being at the vanguard of planet-saving technologies.

Yet it is Honda that stole the march with the presentation at Geneva of a driveable fuel cell-powered vehicle -- until now, such things had been confined to test beds and highly experimental prototypes.

Although still officially a concept, this vehicle is fully functional and a development of it could be production as soon as the end of this year, with Honda committed to selling this model in Japan and the U.S. next year.

It features a newly-developed compact, high-efficient Honda fuel-cell (FC) stack in a spacious saloon body. It offers a large, comfortable cabin and futuristic styling along with significant improvements in power output and environmental performance. It has a range of 354 miles (570 kilometers) and a top speed limited to 100 mph.

One of the biggest surprises was the announcement by Morgan, purveyor of quintessentially British sports cars, that it intends to develop a hydrogen fuel cell-powered machine. The company is famous for its traditional production methods, but managing director Charles Morgan announced a hydrogen-fueled, zero-emissions car -- using Morgan's traditional ash-framed body -- would be launched at Geneva next year. The goal is a lightweight car with a range of 200 miles.

(Picture Right: Lexus hopes LS600h will set standards in environmentally-conscious luxury cars)

The application of fuel-cell technology in smaller cars was investigated by Peugeot, with its Epure version of the 207CC. The existing small coupe-cabriolet (an open-top car with electrically operated folding steel roof) has a fuel cell developed in conjunction with the French atomic energy commission, which powers an electric motor to supply drive.

The investment in petrol-electric hybrids is massive.

Kia Motors of Korea demonstrated its intent to become a major player with the unveiling of its Rio Hybrid saloon at Geneva.

The European premiere of the hybrid celebrates the recent announcement that Kia, together with fellow Korean manufacturer Hyundai, will supply the Korean environment ministry with almost 4,000 hybrid vehicles over the next two years as part of the country's program of 'real-world' testing to develop this type of car propulsion. The existing Korean test fleet numbers 780.

The Kia Rio Hybrid saloon used in these tests has a 1.4-liter petrol engine, mated to a 12kW, 95 Nm AC synchronized electric motor and a continuously variable transmission (CVT) gearbox.

The high-torque permanent magnet electric motor is mounted between the flywheel and the gearbox and "assists" the petrol engine during starting, accelerating and hill-climbing, switching off during steady cruising when the petrol engine is at its most efficient. During deceleration it employs regenerative braking to recharge the battery.

The computer-controlled system also allows stop/start motoring which switches both engine and motor off whenever the car comes to a standstill for more than a few seconds. Restarting is automatic.

Compared to the standard petrol Rio, air pollutants are reduced by 37 per cent and fuel efficiency is improved by 44 per cent. The hybrid's CO2 figure is 126 g/km. There's little price to pay in terms of performance, with a top speed of 112 mph and 0-62 mph in 12.2 seconds, aided considerably by the inherent surge of torque from zero revs provided by the electric motor. Overall fuel consumption is 53.4 mpg.

To reduce fuel and power demands, the Rio Hybrid has an aluminum bonnet, boot lid and front seat frames, as well as lightweight wheels, low-friction tires and electric (rather than hydraulic) power steering.

Glimpse of future
Already to hit the streets is the latest petrol-electric hybrid from Lexus, the LS600h, which aims to set new standards in environmentally-conscious performance among luxury cars. It has a 5.0-liter V8 petrol engine, with two fuel injectors per cylinder and VVTi-E intelligent valve timing on the intake to boost performance and reduce emissions, noise and vibration.

What separates the Lexus from other luxury saloons is the inclusion of an electric motor, which enables the car to have the performance of a conventional V12-engined car with much lower fuel consumption and emissions. Its EC Combined economy is 29.7 mpg, with carbon dioxide emissions of 220 g/km, figures which compare well with the levels achieved by the cleanest diesels in the segment.

Honda unveiled its Small Hybrid Sports Concept at Geneva. This is a sports car that features a development of the company's existing hybrid technology in an effort to demonstrate that stylish design and driving enjoyment can be combined with low environmental impact. It was designed by Honda R&D Europe, based in Germany.

Meanwhile, Honda UK has announced that it plans to sell more than three times as many Civic Hybrids this year than in 2006, up to about 3,000 units.

Arch-rival Toyota revealed a new hybrid concept model, the Hybrid X. Designed by Toyota's European Design center, it gives a glimpse of the future for Toyota's hybrid synergy drive system, according to Toyota Motor Europe's executive vice-president, Thierry Dombreval.

"Over the next few years, we plan to double our global hybrid vehicle offering, anticipating annual sales of over a million hybrid vehicles by early in the next decade," Dombreval said. Including the compact Prius, Toyota and Lexus have 11 hybrid models on sale, and have sold 900,000 hybrids worldwide, of which 650,000 are the Prius.

Toyota also showed the FT-HS hybrid sports car shown at Detroit in January, which has a hybrid system capable of developing 400 bhp, providing a 0-60 mph acceleration time of about four seconds.

"Hybrd X and FT-HS represent two poles of the hybrid spectrum, which define the frontiers for an array of hybrids in the future," Dombreval added.

Biofuels -- those produced from naturally occurring products such as sugar cane -- are seen by some manufacturers as a way of reducing reliance of petrol while reducing harmful emissions. The fact that most cars also produce more power when running on bioethanol fuel is a bonus.

Saab already has a full range of flex-fuel (capable of running on petrol and biofuel) cars, and at Geneva launched a new, 1.8-liter flex-fuel engine for its 9-3 range of saloon, estate and convertible. The new engine 50-70 per cent less carbon dioxide (CO2) than its 1.8 t petrol engine equivalent, yet produces 17 per cent more power (to 175 bhp) and 10 per cent more torque (to 265 Nm) on bioethanol E85.

For comparison with standard petrol engine, the flex-fuel 9-3 sprints from 0-62 mph in 8.4 seconds and 50-70 mph in fifth gear -- a crucial test of real-world flexibility -- in 13.9 seconds, compared with 9.5 seconds and 15.0 seconds respectively.

Until the widespread availability of petrol-electric hybrids, there is still plenty of investment in cleaner internal combustion engines, both petrol and diesel. There is a genuine desire to achieve this, although the specter of even tougher Euro V emissions legislation is obviously an incentive.

Volkswagen has a range, called BlueMotion, designed to reduce fuel consumption. A Polo supermini has already gone on sale, and at Geneva the company announced BlueMotion versions of its Passat mid-size car and Touareg SUV.

The Passat BlueMotion saloon returns 55.4 mpg and produces just 136 g/km of CO2. Both saloon and estate models have a range of up to 838 miles (1,350 km).

Performance is barely compromised, with a top speed of 120 mph.

The Touareg SUV also has a turbodiesel engine, a 3.0-liter V6 developing 223bhp, with a Selective Catalytic Reduction system (SCR) reducing NOx emissions by up to 90 per cent. Current Euro IV emissions regulations dictate a NOx limit of 0.25 g/km -- the SCR-equipped Touareg meets the 0.043 g/km US limit.

The system sprays a film of ammonia-rich solution stored in an auxiliary tank into the exhaust stream before it reaches the new catalytic converter. A reaction occurs within the exhaust system to split the nitrogen oxide into harmless nitrogen and water. The SCR system works in conjunction with a diesel particulate filter and a conventional catalytic converter to further reduce emissions.

Although there are no plans to introduce the system in Europe, VW says that the SCR-equipped Touareg will go on sale in the US next year.

After being a late arrival on the diesel front, Honda produced a highly acclaimed 2.2-liter unit. Its next-generation diesel engine is claimed to reduce emissions to the same level of a petrol engine. A catalytic converter reduces nitrous oxide (NOx) emissions to a level that enables the engine to meet stringent US Environmental Protection Agency (EPA) requirements.

The catalytic converter uses the reductive reaction of ammonia to "detoxify" oxides of nitrogen by converting them into harmless nitrogen (N2). However, unlike the VW SCR system which uses an injection of liquid containing ammonia, the Honda system uses ammonia generated within the catalytic converter. Honda plans to introduce its next-generation diesel engine within three years.

Lack of a credible diesel engine severely hampers sales potential in prime European markets -- just ask Jaguar, which saw a sales slump due to its line-up of large-capacity petrol engines only.

Cadillac, part of General Motors, introduced a new V6 diesel at Geneva, a 2.9-liter unit developing 250 bhp and 550 Nm of torque. Its first production application is scheduled for 2009 in the next Cadillac CTS.

Off-road specialist Land Rover has a novel approach to woo car buyers who are concerned about the environmental impact of their purchase. Its CO2 Offset Program enables buyers of all new Land Rover vehicles sold in the UK pay to offset the CO2 emissions produced by their vehicle, calculated on the certified CO2 emissions level for each model up to 45,000 miles, or about three years of use. The cost is from £85 to £165 depending on model.

The ultimate goal is CO2 neutrality, with investments being made in renewable energy projects such as wind and solar, technology change and energy efficiency.


By Paul Hudson for CNN

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Hybrid Cars Prices and its Tax and Credit

Prices are dropping and most still have tax incentives. Now, however, federal tax incentives can cover much of the cost difference.

Tax credits running out

Once a given manufacturer sells more than 60,000 credit-eligible vehicles, tax credits for that company's vehicles start being reduced and ultimately eliminated.

Toyota is now offering rebates and discounts to make up for lost tax credits.

For example, because Toyota is past the sales limit, the tax credit for purchasing a Prius has dropped to $1,575, from $3,150 in September 2006. Factoring in the tax credit, a Toyota Camry Hybrid purchased now should cost about $23,118, according to Edmunds True Market Value. Prices for other hybrid vehicles are falling as well, but not as fast. Tax incentives for those vehicles, like the Ford Escape and Mercury Mariner Hybrid, remain high, however.

Some state and local governments also offer tax incentives to purchasers of hybrid vehicles.

In addition, some corporations, such as Bank of America, offer cash incentives for employees who purchase hybrid vehicles. Some insurance companies, such as Travelers and Farmers Insurance Group, offer discounts to drivers of hybrid vehicles.

Prices likely to rise

Hybrid prices probably aren't going to stay low for long, though, Rosten told CNNMoney.com.

Either through errors or tricky rules, not all hybrid buyers will get the tax credit they had expected.

If you bought a Toyota Prius last summer you may have thought you were entitled to a $3,150 tax credit.

Following a story we published Friday about the cost-effectiveness of purchasing a hybrid vehicle, CNNMoney.com received an email from one reader who filled out the wrong form - she mistakenly asked for an electric vehicle tax deduction - and thought she was entitled only to a $1,000 tax credit, not the $3,150 credit she was actually supposed to receive.

She's now filing an amended tax return.

If a family's taxes, figured the old-fashioned way, come in below the AMT amount, they have to pay the higher AMT.

But the tax was never indexed for inflation since its 1970 inception. In that case, you're only allowed to claim as much of the tax credit as you can without reducing the taxes you pay below the AMT amount.

At tax time, Bob finds that for his income he's paying less in taxes than the AMT mandates, so he must pay the AMT. Bob gets no hybrid tax credit for his Prius.

Jane doesn't have to pay the AMT, either. But her taxes are just $1,500 more than she would have had to pay under AMT. Finally, if you bought a Toyota hybrid vehicle last year, the date you purchased the vehicle will influence how much your tax credit is.

Just in case you missed this detail: Because Toyota sold more than 60,000 hybrid vehicles last year, tax credits for those vehicles began phasing out after September. Also, the tax credits do not apply to leased vehicles and only apply to vehicles purchased new, not used.

Summarized by WS from CNN.com

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Hybrid Cars and Gas Prices

According to auto industry executives, hybrid cars and diesel cars will jockey for market position as long as gas prices remain under $3. While gas prices hung around $3, interest towards hybrid and diesel cars grew because consumers had concerns about the costs of filling the tanks of conventional cars. Now that gas prices have dropped, the concern for stretching every gallon of gas has also fallen.

Consumers are not as drawn to hybrid vehicles and diesel cars because they have no reason to spend anywhere from a $3,000 to $10,000 premium on an alternative fuel car. For much of the next decade, gasoline-powered hybrids, diesel engines and cars that can run on blends of gasoline and ethanol will jockey for market position, executives said.

Hybrids save fuel by using an electric motor at times rather than the gasoline engine. Diesel fuel can cost more than gasoline but gets 20 percent to 40 percent better fuel efficiency, meaning you go farther on a gallon.

The auto web site, Edmunds.com, is now saying that some hybrid cars are worth their premium price tag due to higher gas costs and tax credits from the government. "High gas prices and generous tax credits now offset the high sales prices of some hybrids, assuming owners keep their hybrids for a few years," said Alex Rosten, an analyst with Edmunds.com. 30, the tax credit gets cut in half. The tax credit on Toyota and Lexus hybrids is scheduled to drop to 25 percent in April 2007 and then be eliminated in October 2007.

Summarized by WS

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Chrysler to make hybrids with Hemis

Durango and Aspen hybrids will use powerful V8 engine for more hauling capability.

By Peter Valdes-Dapena, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- Chrysler Group announced Monday that the gas/electric hybrid Dodge Durango and Chrysler Aspen SUVs to be released in 2008 will be powered by the company's 5.7-liter Hemi V8 engine.

The SUVs will use a "two-mode" hybrid system developed by Chrysler in conjunction with General Motors and Germany's BMW. The first vehicle to be sold using the system will be GM's GMC Yukon Hybrid slated to go on sale this fall.

Chrysler, the U.S. arm of DaimlerChrysler, calls the 5.7 liter Hemi, also used in the company's Chrysler 300C and Dodge Charger R/T sedans, its most fuel-efficient V8 engine. The Hemi engine shuts off four of its eight cylinders during highway cruising when their extra power is not needed.

In the hybrid SUVs, that engine will be coupled with electric motors to provide additional power, allowing the gasoline engine to work more efficiently and to shut off altogether whenever the vehicle is stopped. Batteries for the electric motors are charged using power from the gasoline engine.

Chrysler promises a 40 percent improvement in fuel economy in city driving and a 25 percent improvement in overall economy compared to the non-hybrid Hemi-powered SUVS.

The closely related Hemi-powered Durango and Aspen are estimated to get about 15 miles per gallon in combined city and highway driving, according to the EPA. That would increase to just under 19 miles per gallon overall in the hybrid versions, according to Chrysler's estimates.

Using the 345-horsepower V8 engine preserves hauling and towing capabilities that are important to Durango and Aspen buyers, according to Chrysler. Both SUVs are currently available with a smaller, less powerful V8 engine but the smaller engine does not provide better fuel economy, according to EPA estimates.

"We have to think hard about the consumer who buys vehicles like the Dodge Durango and the Chrysler Aspen," said Mark Chernoby, Chrysler Group vice president for advanced vehicle engineering, in a recording made available to journalists. "These are people who want to have hauling capability."

The two-mode hybrid system is designed to provide the most efficient performance in both city and highway driving, according to GM and Chrysler. The system is engineered to fit almost entirely within the vehicle's transmission tunnel, making it easier to adapt for use in different vehicles.

Chrysler does not currently offer any hybrid vehicles. GM currently sells a "mild hybrid" version of its Saturn VUE crossover SUV and will beginning offering more hybrid SUVs next year. Ford currently sells hybrid versions of its small Ford Escape and Mercury Mariner crossover SUVs and will begin offering hybrid versions of some of its cars next year.

Last year, more than half of the hybrid vehicles sold in the U.S. were produced by Japan's Toyota Motor Corp., according to Power Information Networks.

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Haulage goes green

By Paul Hudson for CNN

The drive towards more eco-friendly vehicles isn't the preserve of the manufacturers of passenger cars.

Commercial vehicles also contribute to congestion and emissions, and although few of us spare a thought for them most of us rely on them to transport the goods we buy.

At the UK's premier Commercial Vehicle (CV) show in Birmingham, makers were just as keen to promote their green credentials as the most fanatical auto manufacturers.

British manufacturer Vauxhall unveiled a range of panel vans than run on E30 biodiesel, a mixture of conventional diesel and fuel made from renewable resources, meaning carbon dioxide (CO2) emissions reduced by up to 20 per cent over similar vehicles running on 100 per cent conventional diesel. It is planning trials of two models with a major fleet customer.

As part of a controlled fleet trial, a number of vans will run on biodiesel B30 across the UK as Vauxhall and its parent company General Motors investigate the long-term potential for the fuel in the UK, and look towards a more widespread distribution network for it.

Biodiesel is made from naturally renewable sources such as sunflower and rapeseed oils, where the oil is extracted and transformed into a methyl ester. Biodiesel B30 is a mixture of 30 per cent biodiesel and 70 per cent conventional diesel.

Emissions from the fuel are reduced because plants grown for conversion to biodiesel actually absorb CO2 from the atmosphere.

Although biodiesel can be produced from a variety of sources, quality is critical, and GM is calling on the EU and the UK government to look at establishing a quality specification for the fuel.

Vauxhall's managing director, Bill Parfitt, said: "Fuel efficiency is already one of the top priorities for our commercial vehicle customers. Payload and duty cycles mean downsizing is generally not an option, so achieving further CO2 reductions becomes a real challenge."

"The introduction of biodiesel B30-compatible models is one way GM can help customers reduce their CO2 emissions and is part of General Motors' wider commitment to alternative fuels and advanced propulsion systems -- we're very pleased to be the first manufacturer planning to fully trial the fuel in the UK."

"Of course, governments have an important role to play as well, specifically in terms of ensuring the quality and wider availability of the fuel, and providing incentives to encourage customers to buy it."

The biodiesel B30-compatible vans aren't the only vehicles offered by General Motors to successfully use biofuels. Swedish auto brand Saab introduced petrol-based BioPower vehicles in 2005, which are capable of running on any combination of petrol and bioethanol E85.

The increased use of platform sharing, in which a whole range of passenger cars and commercial vehicles are planned one chassis platform, makes it easier for manufacturers to roll out fuel-efficient technologies.

There's also a drive towards battery-powered vehicles -- particularly for short-distance, urban use -- although hybrids are still seen as the longer-term solution.

The development of wholly electric vehicles has been spurred by the planned Low Emission Zone (LEZ) restrictions in London. Other makers that are simply keen to show their green credentials, through dramatic emission reductions (including carbon dioxide and noise), are showing great interest in diesel-electric hybrids.

As yet, there are no CV hybrids available in the UK market. Most are still at the prototype stage and, as Toyota and Honda have found with their Prius and Civiv passenger car petrol-electric hybrids, involve considerable investment before any profitability can even be considered.

Therefore, in the CV world at least, electric vehicles are seen as viable in the short term. Despite shortcomings in weight, range and performance -- mainly connected with limitations of current battery technology -- they are simpler and less costly than an equivalent hybrid.

Smith Electric Vehicles of Tyne and Wear, whose milk-floats have been used by dairies all over the UK for more than 40 years, unveiled a range of electric vehicles at the CV show

The adoption of sodium nickel chloride batteries in place of the hitherto ubiquitous lead-acid type are at the heart of what is claimed to be the technology breakthrough for SEV. These power packs are about 80 per cent than lead-acid units with the same energy storage, and deliver more performance.

The converted Ford Transit on show has a claimed top speed of 80kph (50mph) in combination with a range of up to 240km (150 miles).

Modec uses the same battery technology for its electric vehicles, and says that UK supermarket giant Tesco will be using the vehicle for home deliveries of groceries. The new trucks can carry a two ton payload, have a 100-mile range and a top speed of 50mph, all on one overnight charge.

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GM: The new green carmaker?

The planet's biggest car company shows off its Earth-friendly side.

By Peter Valdes-Dapena, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- The belief that General Motors has all the environmental sensitivity of a panda fur wholesaler has been widespread for a long time.

This is a company that has, in recent memory, relied on its largest, least fuel-efficient vehicles for profits, making it an easy target for environmentalists.

Kicking things off at the Los Angeles Auto Show this week, the world's largest automaker embarked on a big campaign to change that image.

There was an environmental theme at the show that even included a competition among California-based auto designers to come up with the niftiest enviro-friendly fantasy cars. GM won that competition with the Hummer O2, an off-roader with algae-filled body panels that produce oxygen from sunlight.

Out on the show floor, Ford and Honda both are both showing hydrogen fuel cell vehicles. But it's GM, again, that's really making the big green push.

It's appropriate that GM kicks this off in California, the state that, basically, required manufacturers to sell electric cars in the 1990s. Several manufacturers did, including Ford, Honda and Toyota, and all decided there was no market for those vehicles. They all stopped producing them for good as soon as the rules changed.

GM alone, however, has born the PR fall-out for that decision after a recent documentary drew attention to its decision to withdraw and destroy its EV1 electric cars.

Now, GM says, it's getting back into "electrified vehicles" with products it hopes consumers will ultimately find more palatable.

None of the fuel-saving vehicles GM showed at the L.A. Auto Show will have a big impact on the company's sales any time soon. Even the hybrid vehicles coming out in the next two years won't do much because hybrids still represent a tiny fraction of the U.S. car market.

Hydrogen fuel cell cars are still in the distant future as a mass-market item, but GM took a small step forward with 50 road-ready Chevrolet Equinox Fuel Cell vehicles.

That's half the 100 that the company will give to "everyday drivers, celebrities and policymakers" to drive around L.A., Washington, D.C., and New York in what the company is calling "Project Driveway." GM will listen ardently to their feedback, the company says.

Also on display at the show: the Chevrolet Sequel fuel cell vehicle. This is a more advanced vehicle, built for from the start as hydrogen fuel-cell vehicle.

In hydrogen fuel cell vehicles, a chemical process that makes water out of hydrogen and oxygen also releases electricity that drives the car.

"With Chevrolet being GM's global volume brand, it makes sense that Chevy will lead GM's fuel cell vehicle charge," said Ed Peper, Chevrolet's General Manager, in an announcement prepared for the show.

Saturn, meanwhile, is taking the point position in GM's roll-out of its gas/electric hybrid technologies. Coming to market long after Toyota, Honda and Ford had begun selling hybrid vehicles, GM's first hybrid, the Saturn Vue Green Line, is just entering dealerships now.

It's a "mild hybrid," meaning its electric motor lacks enough power to actually drive the vehicle alone. Critics call it a cheap way to make a hybrid, but that, says GM, is part of the benefit. Their Vue's hybrid system costs consumers less to buy because it costs less to make.

The other advantage of the "mild hybrid" system is that requires just a small battery pack. You can see that in the new Aura Green Line sedan. Other hybrid sedans lose trunk space to make room for batteries, but not this one.

In 2008, a completely redesigned Saturn Vue SUV becomes available with the same "full hybrid" system GM is using on its large SUVs. That Vue is expected to get a 45 percent improvement in fuel economy compared to the regular V-6-powered Vue. The current "mild hybrid" Vue gets only a 20 percent improvement in fuel economy. (Actual mileage numbers aren't available yet.)

The redesigned Vue with full- and mild-hybrid systems will be available to consumers at the same time, the company says. You can take your choice. Lower price or more fuel economy.

Someday, a plug-in hybrid version of the Vue will become available, GM promises. That vehicle will use the full-hybrid system, but with the additional capability of having its batteries charged from a wall outlet.

The plug-in Vue will be able to drive for more than 10 miles at moderate speeds using electricity only, according to GM.

But that requires much more advanced battery technology than anyone currently has at hand. So, while the rest of the system is ready to go, GM says, it has to wait to wait for battery suppliers to come up with a something that's up to the task.

At the end of Wagoner's presentation, two men went up on stage with a huge paper they asked Wagoner to sign. They said it was a pledge for GM to be the leader in fuel economy by 2010.

Wagoner replied, "I think my speech speaks for itself."

There's virtually no way GM will be the leader in fuel economy in just four years. But perhaps, by then, it can remove the big "Kick me, I'm bad for the planet" sign from its corporate back.

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Saturn Vue Green Line: hybrid for tightwads

With its first mass-market hybrid, GM emphasized cost savings. That may be just what the market needs.

By Peter Valdes-Dapena, CNNMoney.com staff writer.

NEW YORK (CNNMoney.com) - In creating its first gas-saving hybrid vehicle for the mass market, General Motors took the cheap way out. This time, it could prove to be a very smart move.

The fact is, hybrids just aren't selling like they used to. While the Toyota Prius is still a hot item, Ford is offering incentives on its hybrid SUVs, and sales for other hybrid vehicles are softening.

One reason is that most hybrids, unlike the Prius, are not distinctive. A Toyota Highlander Hybrid looks like a Toyota Highlander. A Ford Escape Hybrid is a Ford Escape. "So the hybrid becomes another powertrain option," said Anthony Pratt, an analyst with J.D. Power and Associates.

That means that consumers are increasingly putting hybrid systems through the same cost/benefit analysis to which they would subject any other high-cost option.

For consumers simply looking to save money in the face of rising gasoline prices, it makes more sense to purchase a fuel-efficient vehicle that doesn't rely on hybrid technology. Hybrid versions of vehicles usually cost about $3,500 to nearly $8,000 more than non-hybrid versions. Part of that cost is for unrelated options that usually come as part of a hybrid package that you might not even want - third row seats, leather interior, wood grain veneer.

Another answer might be to buy a vehicle with a less complex, less expensive hybrid system. It might not be quite as fuel-efficient but it will pay for itself faster.

The Saturn Vue Green Line hybrid SUV, coming out this summer, will cost about $2,000 more than a regular Saturn Vue. Its sticker price will be about $23,000, making it the cheapest hybrid SUV you can buy.

"A total price in the low $20,000 range, I think, opens the door to the mass market," said Jesse Toprak, executive director of industry analysis for Edmunds.com.

The Vue Green Line uses a system that relies on lower voltage than other hybrids. That means, for one thing, that the Vue Green Line doesn't need nearly as large of a battery pack. Batteries cost money and add weight. It also made the Vue's hybrid system easier to integrate into a normal automotive electrical system which, again, means lower cost.

But the Vue Green Line's electric motor can't actually drive the vehicle on its own even at low speeds, the way, for example, a Ford Escape Hybrid's can. In all hybrid vehicles, the gasoline engine automatically shuts off as soon as the vehicle stops moving even at stop signs and red lights. That saves all the gas wasted in pointless idling.

But, once the vehicle gets going again, the Ford Escape Hybrid can crawl through city traffic without starting its gasoline engine at all, at least until the battery needs recharging. In the Vue Green Line, however, the gasoline engine starts running the moment the driver's foot lifts off the brake pedal. The electric motor in the Vue assists the gasoline engine in propelling the vehicle but it is too weak to do much on its own.

Instead of having a high-efficiency continuously variable transmission, as other hybrid vehicles do, the Vue Greenline has the same four-speed transmission as the regular Vue. Again, the slight gain in efficiency that would have come from a CVT wasn't worth the added cost.

Some hard-core hybrid fans may look askance at the Vue's low-cost hybrid compromise. It does save gas, but not huge amounts. GM claims the Vue Green Line will get 20 percent better fuel economy than the a regular 4-cylinder Saturn Vue SUV.

Since the Vue is already a relatively efficient SUV, 20 percent means five miles per gallon. Overall, its estimated mileage is a little less than a Ford Escape Hybrid or Toyota Highlander Hybrid, but the Vue Green Line will also cost thousands less than those SUVs.

The Vue Green Line's hybrid system may be the right way for GM to crank up its hybrid vehicle portfolio but it will still face serious hurdles with buyers. For one thing, it's a Saturn Vue. The Vue has not been treated nicely by Consumer Reports, an influential source for car shoppers, which gives it "Much lower than average" marks for predicted reliability and has little good to say about it otherwise. (Despite the criticism, the regular Vue has been selling about as well as the average mid-sized SUV, though, according to Edmunds.com.)

Also, Toprak of Edmunds.com points out, the Vue Green Line will be available in two-wheel-drive only, eliminating a big reason many buyers opt for an SUV to begin with.

In creating a cheaper way to make small hybrid vehicles, GM has taken an important step toward making the technology truly mainstream. Now the trick will be to build a really compelling vehicle around this new powertrain. As gas prices rise, a cheap, efficient vehicle that's genuinely good is something that car buyers will really have an appetite for.

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Hybrids: Don't buy the hype

Sure, hybrids save gas but they won't save you money. There are smarter ways to go.

By Peter Valdes-Dapena, CNN/Money staff writer

NEW YORK - Toyota is now measuring "time on the lot" for the Toyota Prius in hours, not days. The average Prius goes unsold for only about 20 hours after it hits a Toyota dealer's lot, according to a recent report.

With gasoline prices now around $3 a gallon, you might think it makes a lot of sense that hybrid cars are hot sellers.

Actually, it doesn't -- at least not a lot of financial sense.

They may make a social statement you're interested in, but if you want to save money because of rising gas prices, you're heading down the wrong road, at least for now.

Some simple calculations by our partners at Edmunds.com revealed the following:

A hybrid Honda Accord costs about $3,800 more than the comparable non-hybrid version, including purchase, maintenance and insurance costs. Over five years, assuming 15,000 miles of driving per year, you'll make up that cost in gasoline money if the price of gas goes up immediately to $9.20 a gallon and averages that for the whole period.

For the Ford Escape hybrid, the difference is less stark. To make up the difference over five years between the Escape hybrid and a Ford Escape XLT, gas prices would have to average $5.60 after you purchase the vehicle.

The Prius itself, however, could be an exception. There is no such thing as a non-hybrid Prius, making a direct comparison impossible. Compared to a Toyota Camry, a car with similar interior space which costs about $100 more over five years, the Prius driver could actually save a small amount of money.

There is a tax deduction of $2,000 available for purchasing a hybrid vehicle, but that translates to a one-time tax savings of less than $500 for most buyers. That's nice, but it's not enough to make much of a difference in the long run.

The recently passed energy bill includes a tax credit that would range from $500 up to $3,400, depending on the fuel efficiency of the car, for vehicles purchased after Jan 1., 2006. The credit could be enough to create some real savings. For example, Ford estimates the tax credit on a Ford Escape hybrid to be $2,600.

The new rules are extremely confusing, though, said David Mellem of Ashwaubenon Tax Professionals in Wisconsin, and the IRS hasn't yet published an official list of what vehicles will qualify for what sort of tax credit.

Certainly, though, most car buyers who are considering a hybrid will be far better off waiting until 2006 to make that purchase, said Mellem.

In the meantime, there are other ways to save gas that won't cost you any extra money.

Drive more gently

First, change the way you drive. There's no trophy for being first to arrive at the red light, or beating everyone away from the green. In driving tests by Edmunds.com, simply going easy on the gas and brake pedals garnered gas mileage improvements of about thirty percent. Hybrid buyers pay thousands for that kind of savings.

Check out diesels

Second, consider buying diesel. Diesel cars cost only a little more than gasoline-powered cars, but they get far better fuel mileage. Also, because their engines are more durable, diesels have better resale value than gasoline-powered cars. That alone should be enough to make up any additional cost of the vehicle, leaving the gas-money savings in your pocket. Also, diesels will qualify for tax credits under the new tax rules. Again, diesel buyers might want to wait until next year to buy.

Shop smarter

Third, look more closely at the actual fuel economy numbers when you buy and consider what you're willing to give up. The promise of hybrids is better fuel economy with the same, or more, engine power. But, for that, you pay more for the complex technology and, to date, long-term resale value is unknown.

You could simply decide that you could do with less engine power or a smaller, lighter vehicle. That way you could get better fuel economy while paying even less money for the vehicle itself. And you don't have to buy a subcompact.

For example, an two-wheel-drive Ford Escape hybrid has a sticker price of about $26,900 and gets an EPA-estimated 33 miles per gallon in combined city and highway driving.

A Ford Focus wagon gets an EPA-estimated 28 mpg in combined driving but it costs about $10,000 less. With the Focus you get about same amount of interior space for passengers and even more cargo room.

Also, you'll have a much easier time negotiating a good price on the Focus wagon than you will on the Escape hybrid, which typically sells at full sticker price.

There are, of course, an endless number of similar comparisons out there. The point is, don't just get sucked into the hybrid hype. If what's really important to you is saving on fuel, do a little thinking before you buy. There are lots of options available.

Source: CNN Money

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Survey: Consumers skeptical of hybrids

Cost of servicing hybrid system, and its lifetime performance among consumers' main concerns.

NEW YORK - Wary of purchasing that hybrid car even though gas prices are pinching your wallet?

You're not alone.

According to a survey released Thursday, a majority of consumers are skeptical of hybrid technology even though they feel that hybrid vehicles, which use electric motors in addition to gasoline engines, are likely the future for the American automobile.

In an online survey, conducted by Kelley Blue Book, more than half of 425 individuals polled said they are not interested in purchasing a hybrid or said that they needed more information about the technology.

"Although they've been hyped in the media, the average consumer still questions whether hybrids are for them," says Jack Nerad the editorial director and executive market analyst for Kelley Blue Book. "Based on the results of this study, it seems the auto manufacturers still have work to do before alleviating consumer concerns about the long-term viability of current hybrid technology."

The two most important causes of consumer skepticism, according to the survey, were the potential costs of servicing a hybrid vehicle and maintenance over its lifetime.

Sixty-one percent of consumers said they were worried about the servicing costs to fix a hybrid, while 55 percent of those polled expressed concern about the longevity of the battery pack.

Taking a back seat to maintenance concerns were worries about driving performance or delivering the promised level of fuel efficiency.

At the same time, consumers are optimistic about the future of hybrid technology.

More than half of those polled said that in five to ten years, hybrid cars will be able to deliver the same performance as a gasoline engine, while 36 percent said that they believe that hybrid engines will take over the automobile market in that time.

A third of those surveyed maintain that today's gasoline engine will continue to be the engine of choice for automakers.

While consumers typically pay more for a hybrid car than its gasoline counterparts, the Kelley Blue Book survey learned that of those individuals who would consider purchasing a hybrid, they are willing to pay, on average, $2,355 more to own one.

Source: CNN Money

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Green cars starting to take root

Demand for hybrid market expanding

From CNN's Phil O'Sullivan

TOKYO, Japan (CNN) -- Environmentally friendly hybrid cars are finally being mass-produced -- thanks to an increase in demand due to rising fuel costs, cheaper technology and growing public acceptance.

Viewed in the industry as the most important innovation since automatic transmission or the self-starting motor, hybrid vehicles run on two power sources: a standard combustion engine, backed up by an electric battery.

Japanese car makers Toyota and Honda have both been producing hybrid cars since the late 1990s.

(Picture Below: The waiting list for the Toyota Prius is months long in the U.S.)

And while hybrids still make up a fraction of all vehicles manufactured, the two automakers look set to put the latest eco-friendly technology up against each other, as the hybrid vehicle becomes accepted by the masses.

Toyota's hybrid Prius sedan, the first mass-produced environmentally friendly vehicle, is so popular that waiting lists in the U.S. are months long.

It is so high-tech, it can even park itself.

Toyota spokesman Paul Nolasco said hybrids were becoming increasingly popular among consumers.

"This car is not a science experiment. It's a real car -- it's very practical -- that you can use in daily life," he told CNN.

Honda has also joined the hybrid party, with the Civic hybrid and a V6 version of its popular Accord car. Ford has come out with a hybrid version of its SUV Escape.

Honda spokesman David Iida said these vehicles were good news for the environment.

"Basically, Honda's philosophy is to introduce environmentally friendly technologies in cars that are mass-produced. That way we can get the biggest effect on the environment as quickly as possible," he said.

Iida said that hybrid vehicles were paving the way for more advanced environmentally friendly technology.

"In the future we see this (hybrid cars) as an interim technology. In the future -- long-term -- fuel cells (may be) the best alternative."

The combustion engine in hybrids kicks in only when required, at higher speeds, for example. When the vehicle is stationary at lights or stuck in traffic jams, the combustion engine is less likely to be running, which means less fuel use, and no polluting emissions.

There is no need to recharge the car's battery; it is replenished by the engine or from energy created by friction from the car's brakes.

Kurt Sanger, auto analyst at Macquarie Securities, said the production of hybrids was still in its infancy.

"Volume-wise, you're seeing maybe 4,000 (or) 5,000 Prius a month in the U.S., versus 25-30,000 Camrys."

Toyota will begin producing Prius vehicles in China -- an important market for the car industry -- next year. Greater volumes will eventually mean lower prices.

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