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Fri, Jan 10, 2003 - Page 12 News List

DaimlerChrysler may use Toyota's electric system

BLOOMBERG , DETROIT

DaimlerChrysler AG's Chrysler unit is considering using a hybrid-electric engine system developed by Toyota Motor Corp as it develops a strategy to increase sales of fuel-efficient cars and trucks.

Chrysler Chief Executive Dieter Zetsche's "position is that we wouldn't rule out working with Toyota, but there hasn't been a decision on using their hybrid system," Chrysler spokeswoman Ann Smith said. Hybrids combine a gasoline engine with electric motors to curb fuel consumption and tailpipe exhaust.

Chrysler and alliance partner Mitsubishi Motors Corp. are studying buying Toyota's technology as a way to enter the market, Automotive News said, citing Zetsche. Mitsubishi Chief Executive Rolf Eckrodt is discussing the issue with Toyota, the report said.

Toyota, which has sold the hybrid Prius small car since 1997, this week showed a new hybrid power system that will be used in its Lexus RX 330 sport-utility. The world's third-largest automaker is to supply the system to Nissan Motor Co and has said other companies may want to use its Hybrid Synergy Drive.

"We would be happy to discuss our hybrid technology with any auto manufacturer," said Jim Olson, senior vice president for Toyota's North American unit. "We have nothing to announce at this time regarding negotiations with any automaker other than Nissan."

Toyota expects global sales of 300,000 hybrids annually in 2005. Nissan in September agreed to work with Toyota and plans to sell at least 100,000 autos using the system beginning in 2006.

Automakers and analysts estimate current hybrid systems add about US$3,000 in additional components costs to a car's price.

The only hybrids now sold in the US are the Prius and Honda Motor Co's Civic Hybrid and Insight cars. Combined sales of the three models were about 35,000 last year.

Analysts expect demand to exceed 1 million units a year by 2012 as governments push automakers to lift fuel efficiency and reduce emissions.

Chrysler last year scrapped a plan to sell a hybrid Dodge Durango sport-utility, and in November said it would sell a diesel engine Jeep Liberty sport-utility in the US next year as a way to improve the fuel economy of its vehicles.

Zetsche has said Chrysler's hybrid strategy would probably focus on a model smaller than its Jeep Liberty.

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