Japan's Toyota, Subaru May Tie Up in Hybrid Cars
Date: 03-Feb-05
Country: JAPAN
Author: Chang-Ran Kim
A spokesman at Fuji Heavy said that although the company had not entered formal talks with Japan's top auto maker, there was a "very high chance" that Toyota's hybrid system would be the best match for its vehicles.
Toyota, which has so far agreed a licensing deal with rival Nissan Motor Co. to supply its hybrid system, has said it would welcome similar deals with other auto makers because higher production volumes would help it reduce per-unit costs.
Toyota accounts for the majority of hybrid vehicles sold in the world now, and also licenses part of its technology to Ford Motor Co.
A deal between the two Japanese companies would underscore Toyota's dominance in the field because Subaru would be choosing its technology over a less efficient hybrid system developed by General Motors Corp., its biggest shareholder.
GM said in December it would develop a new hybrid technology with DaimlerChrysler AG to catch up with leaders Toyota and Honda Motor Co., but the technology is best suited for bigger vehicles.
The Fuji Heavy spokesman said his company was still studying internally what type of cooperation, if any, it would need for its hybrid vehicles.
The Nihon Keizai business daily reported on Wednesday that Toyota, the world's second-biggest seller of cars behind GM, would likely supply the power system, the key component in hybrid vehicles, to Fuji Heavy, which in return would provide Toyota with technology for lithium ion batteries.
"We are in discussions with various auto makers that have expressed interest in our technology, but we cannot name any individual company," a Toyota spokesman said.
Fuji Heavy, held one-fifth by GM, would use the power system in its Legacy and other models sold in the United States, where it generates 35 percent of its sales, the paper said.
Toyota President Fujio Cho and Fuji Heavy President Kyoji Takenaka are expected to hold talks soon on the matter, which had been discussed on a working level since last year, it said.
Hybrid vehicles twin a combustion engine with an electric motor and battery in which the act of braking captures lost energy, enabling it to save fuel and emit fewer pollutants.
The fuel-sipping vehicles have been gaining popularity, especially in the United States, with 88,000 of them sold in 2004 through just three brands -- Toyota, Honda and Ford.
Sales are expected to more than double to at least 200,000 units there in 2005 as oil prices remain high.
Toyota, whose Prius gasoline-electric sedan has been leading the global hybrid market since it first appeared in 1997, has targeted sales of 300,000 hybrid vehicles a year by mid-decade.
(Additional reporting by Sachi Izumi)