Hybrid Makers Still Struggling with Added Costs

Battery makers and suppliers of other key parts for hybrid, energy-saving vehicles have one overriding question: when will the market be big enough to justify their costs?

A hybrid vehicle, which combines an internal combustion engine and an electric motor powered by batteries that can recapture energy normally lost, costs $4,500 to $6,000 more to build than a conventional vehicle, a recent report by the Sanford C. Bernstein investment management firm said.

The upfront cost and load capacity are the main challenges for hybrids due to the expensive electrical motor and battery.

"It is a chicken-and-egg problem - the car makers say to us we want an aggressive price from the beginning and we say to them we can give them an aggressive price when we have the volume," Franck Cecchi, chief operation officer of battery maker Johnson Controls-Saft, said.
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1970toyotamarc - 3/29/2007 7:34:48 PM

+1 Boost

Hybrids are not 4500-6000 more. Gimme a break. Do any of us really know how much each component of a vehcile costs, and how that affects the bottom line? If a hybrid system still, after all these years is costing that much, and it clearly is not all being added to the cost of the vehicle, then hybrids are still being sold at a loss. Quite possible, but not likely. With some 200,000 sold a year, and most every mfr jumping on board, it seems highly unlikely that hybrids are losing money. So this story just does not add up.

XYZZ - 3/31/2007 6:50:13 AM

+1 Boost

toyota is working on bringing down the "hybrid premium."

target is no more than $1000 - 1500 over regular models.