Detroit, Dec. 24: General Motors, which has been the most reticent carmaker when it came to the prospects for hybrid vehicles, intends to offer some form of hybrid electric power on four of its major models over the next four years, according to people briefed on the plan.
GM’s plan, which will be announced next month at the North American International Auto Show here, is a surprising endorsement of the fledgling hybrid technology, which improves gasoline mileage by supplementing the internal combustion engine with electric power. GM, the world's largest automaker, will offer several versions of the hybrid technology. The most advanced will be on the Saturn Vue sport utility vehicle, while less advanced versions will be available on the GMC Sierra pickup truck, a coming Chevrolet pickup truck called Equinox and the Chevrolet Malibu.
The development is a sign that Detroit is growing increasingly serious about the technology as a business threat from overseas. For several years, Toyota and Honda have been the only companies offering hybrid cars. The Toyota Prius, for instance, has an electric motor that takes over for the internal combustion engine at low speeds. The car never needs plugging in, a shortcoming of battery-powered cars, because the battery is recharged by the gasoline engine. Honda sells a small aluminum hybrid, called the Insight, and a hybrid version of its Civic.
“GM needs an aggressive plan just to keep pace with the Japanese, who view this as a core technology over the next decade,” said John Casesa, an analyst with Merrill Lynch. “It’s an idea that hasn't arrived yet, but whose time is coming fast. This is going from an environmental and public relations curiosity to a generally accepted commercial product.”
GM’s plan, along with those of the rest of the industry, could also have considerable tax implications for the country. The Internal Revenue Service already allows a $ 2,000 deduction for vehicles that use alternative fuels or some form of electric power, and Congress has been considering further incentives. Toyota has already said it plans to sell 300,000 hybrids a year worldwide, many of them in the United States, within five years. The Ford Motor Co plans to start selling a hybrid version of its Escape sport utility vehicle a year from now. And DaimlerChrysler has said it will sell a hybrid version of the Dodge Ram pickup truck next year.
GM is presenting several versions of the technology. The most advanced, and most like the Prius, will come in 2005, when the company will offer a hybrid version of the 2006 Saturn Vue. It will get average gas mileage of nearly 40 miles per gallon, compared with average mileage as high as 25 mpg for the nonhybrid versions, people briefed on the plan said.
In 2004, GM will offer a less ambitious version of hybrid technology, for the 2005 model of the GMC Sierra. It will use a small electric motor that allows the truck's engine to shut off at stoplights and restart automatically when a foot touches the accelerator. The modified Sierra will increase fuel economy by about 12 per cent.
And in 2006, GM will offer similar technology on a forthcoming Chevrolet pickup truck called the Equinox and the 2007 model Chevrolet Malibu. The addition of hybrid and other technologies is expected to increase gas mileage on these models.
All told, the technologies will be used on three chief manufacturing platforms, meaning that GM could use it in as many as a dozen models if the demand materialises.
Environmentalists expressed a mix of encouragement and disappointment at the news, part of which was reported Monday by The Wall Street Journal, and said that the Vue, as described, would be a significant improvement.
“GM's hybrid plans are a mixed bag,” said David Friedman, an engineer and analyst for the Union of Concerned Scientists. “The full hybrid Saturn Vue appears to be a move toward good technology. The other vehicles are an example of using good conventional technology.”
“Labelling them as hybrids is an attempt to ride the ‘green’ image of hybrids,” he added.
Russell Long, executive director of the Bluewater Network in San Francisco, another environmental group, said it was “tremendously disappointing that they would take such a weak approach.”
“You’ve got to imagine some of this comes from their anxiety about California and wanting to be prepared for potential regulations here that would essentially force the use of hybrid technologies,” he said.
Indeed, because of coming regulations expected on the federal level and from California, the nation's largest auto market, GM’s plan could be seen as a matter of necessity. Last month, the National Highway Traffic Safety Administration announced a plan that would raise federal fuel economy standards 7 per cent by the 2007 model year. Though environmental groups derided the plan as a baby step, especially considering the heated political climate, it is the largest increase in more than a decade.
And considerable pressure is coming from California. Because the state's clean-air laws predated the federal government's, it has retained the authority to set its own air standards, and other states can opt to use California's tougher standards. Long's group drafted a proposal to cut automotive greenhouse-gas emissions that has become law in California, the first such law in the nation. The industry is expected to mount a vigorous legal challenge before the law is to take effect late in the decade.
GM had previously been noncommittal on the idea of producing a full hybrid vehicle.
“I don't think anybody's got confidence that the economics make any sense,” Rick Wagoner, GM’s chief executive, said in an interview in August.
At a high-level meeting in the late ’90s, company officials decided to throw most of GM's research-and-development dollars behind hydrogen fuel cells, which the industry has embraced as the power source that will eventually make the internal combustion engine obsolete. But there is wide disagreement on when fuel cells will be ready for mass marketing, and of the great challenges like outfitting the nation's filling stations with hydrogen instead of gasoline.
The economic equation will be addressed by relying on government incentives.
GM plans to price the hybrids at cost, meaning that they could cost a few thousands dollars more than the conventional versions of similar vehicles at first.
Increasingly, fuel economy is becoming a business issue as well as an environmental one and attracting the attention of Wall Street. Casesa, of Merrill Lynch, said, “We're moving toward a future with higher fuel-economy standards, risks to energy supplies and higher environmental consciousness.
“If we decide to dramatically increase fuel economy,” he added, “there is no way to do that besides making cars smaller, unless you have a new technology. And this is that technology.”