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The Perils of Pols Picking Winners and Losers



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Plug-in hybrids to the rescue? Not so fast. According to today’s WSJ, Toyota is preparing to roll out some plug-ins, but significant cost and infrastructure hurdles remain. And note the quote from Audi honcho Johan de Nysschen:

Toyota has said that conventional hybrids are the auto maker’s core alternative technology and has set a goal to have that option in all its models by 2020. But Toyota has pushed ahead with plug-in hybrids as its competitors race to release similar models or to build zero-emission, all-electric vehicles.

General Motors Co. plans to begin selling the Chevrolet Volt in 2011. Nissan Motor Co. seeks to roll out an all-electric car next year. Mitsubishi Motors Corp. introduced the world’s first mass-market electric model, the i-MiEV, in Japan earlier this year. And Daimler AG aims to start a pilot program for an electric version of its Smart minicar in China next year.

But the cost of such cars may be prohibitive, analysts warn. The U.S. National Research Council in a new report Monday said the current high cost of the lithium-ion batteries used in plug-in hybrids exceeds the fuel savings reaped over a vehicle’s lifetime. The NRC estimates it would cost $18,000 more to produce a plug-in hybrid electric vehicle next year than a regular gas-powered car.

“While these costs will come down, a fundamental breakthrough in battery technology, unforeseen at present, would be needed to make plug-ins widely affordable in the near future,” the group said.

And many auto makers are reluctant to begin investing in electric-car technology before a recharging infrastructure is in place. Audi of America Inc. President Johan de Nysschen said Monday the U.S. car market won’t be able to support plug-in all-electric vehicles on a mass scale for at least 20 years.

He criticized the U.S. government’s multibillion-dollar investment in the technology, contending that other technologies could offer more immediate benefits. “I fear right now that government investment is essentially prejudging winning and losing technologies,” Mr. de Nysschen said in a speech at the National Press Club.



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