Toyota expects to eliminate hybrid cost premium

Toyota Motor Corp expects to cut the costs of manufacturing hybrid cars sufficiently by 2010 for them to be as profitable to make as conventional models.

Reuters reports that Toyota has been pushing for the fuel-saving powertrain to enter the mainstream since launching the Prius, the world's first hybrid car, in 1997, but sales have come at the expense of profitability given their high production costs.

If it succeeds, Toyota will be removing the main hurdle to cost-competitiveness for the hybrid - the cost of the powertrain, which twins a conventional engine with an electric motor.  By 2020, Masatami Takimoto, Executive Vice President in charge of Toyota's powertrain development, said he expected hybrids to become the standard drivetrain and account for "100 percent" of Toyota's vehicles.

Among other alternative-fuel vehicles, Takimoto said Toyota should be able to mass-produce zero-emission fuel-cell vehicles, which run on hydrogen, by 2020. A prototype with a cruising range of 500 km (310 miles) - equal to today's gasoline cars - would be ready soon, he said.

Toyota is trying to reduce the weight of vehicles through increased use of high-tensile steel and resin products as other means of improving fuel economy.