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Posted on  

July 31, 2002

Ford Evaluates Offering `Hybrids' That Use Electricity and Gasoline

DETROIT -- Ford Motor Co. (F) is calculating how to offer Volvo, Land Rover, Mazda and other vehicles powered by electric-gasoline "hybrid" systems during the next several years, including possible component collaboration with Toyota Motor Corp. (TM), Tuesday's Wall Street Journal reported.

Ford plans to start producing a hybrid version of the Escape sport-utility vehicle in late 2003. So far, Toyota and Honda Motor Co. make the only hybrid vehicles available in the U.S., both compact cars offering improvements in fuel economy of as much as 40% over traditional engines -- but at a cost of several thousand dollars more. If Ford enlarges the scope of its hybrid plans, it would represent one of the biggest commitments yet by an auto maker to the fuel-saving technology.

"We're in the process of evaluating . . . what other vehicle lines and platforms make sense, and what time frame, for us to be able to offer the technology" more widely across the Ford stable of brands, said Prabhakar Patil, head of Ford's program that is developing the Escape hybrid.

To reduce the cost of this still-maturing propulsion technology, Ford has been negotiating with Japan's Toyota and certain suppliers, Mr. Patil said, to "unify hybrid requirements and specifications" to create a pool of common hybrid parts. The move, he said, would boost economies of scale on each major part and cut costs greatly.

Ford was initially skeptical about hybrids. Just a couple of years ago, some Ford engineers and executives were calling hybrids impractical and thought it would be difficult to make money with hybrids. But today, the No. 2 auto maker deems gas-electric hybrids a "huge growth opportunity," said Richard Parry-Jones, a Ford group vice president.

What changed? Mr. Patil said consumer interest in the Escape hybrid has "gotten steadily stronger" since Ford announced it would develop the hybrid SUV, boosting confidence in the company's plans to offer a similar hybrid version of the Freelander, the Volvo XC90, the Mazda Tribute, all SUVs similar in size to the Escape.

Ford believes the Escape hybrid, likely to be priced around $25,000, with the buyer expected to get a federal income-tax deduction of as much as $2,000, has good potential to become a mass-market vehicle. Mr. Patil's team, he said, has configured the architecture of the Escape hybrid to be "compatible with other platforms" in-house, to minimize the investment required to make available a hybrid option in other nameplates.

Wall Street Journal Staff Reporter Norihiko Shirouzu contributed to this report.

 

 

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