When the price of gas hit about $4 per gallon in the US last year, the sales of the SUV, which had been the favourite vehicle of the US citizens for a while, substantially dropped, while fuel efficient cars and hybrids managed to get their foot through the door. (Though once the prices dropped, Americans were back to their usual ways).However inspite of being costlier than the usual gas powered cars, the hybrids slowly have made space for themselves in the market.
Japan has been the leader in Hybrid vehicles with its two automobile giants, Toyota and Honda, having launched their Prius and Insight brands respectively. The Prius has already captured the hybrid car market in the US with increasing sales each year. By far this year, Toyota has sold approximately 150,000 units. Honda’s Insight which made its debut in US recently, is also expected to have strong sales.
The American car giants are not doing that great in the hybrid market. General Motors which recently went bankrupt and will survive only with the aid of the US government, had initially a nice technological advantage in this market with its Chevy Volt. But they blew it by concentrating instead on the gas guzzling and fuel inefficient SUVs.
As concerns the EVs (just to clarify, EV vehicles run only on batteries, hybrids can work both on electricity and gas) Mitsubishi motors has launched its new all electric vehicle i-MiEV in Japan. According to the company, “Keys to the i-MiEV’s performance include an ultra-quiet permanent magnet synchronous motor and a powerfully efficient lithium-ion battery pack that can be quick-charged up to 80 percent of capacity in as little as 30 minutes.”  The cost of the the i-MiEV, which has a range of 99 miles (160 km) on a single charge, is a considerably steep $47,500.

Nissan also aims to bring its EV-02 Cube Electric Car in the market by 2010. Another Japanese company, Subaru, will bring out its own electric car, the Stella, for $49,255.

The EVs are thus considerably costlier than their hybrid counterparts. (The cost of Prius for example ranges from $22k to $30k) The main reason for this is the expensive lithium-ion batteries.  In addition, due to the low mileage obtained with one battery charge, the EVs are also not suitable for long distance driving, but are mostly useful in cities. It will be atleast a few years before the EVs can catch up with hybrids. However the EV manufacturers are trying to impress upon the people the advantages of a car which saves them on gas. Though initially a high investment, in the long run these cars will save the owner considerable money on gas prices. Also electric cars have lower maintenance costs because of lesser mechanical parts.

Some companies have also come with ideas like allowing buyers to lease expensive battery packs to spread the cost over the lifetime of the car.  In addition Japanese and now even Chinese governments are offering subsidies to EV and hybrid car buyers. China specially is making concerted efforts in this direction.

According to a NYTimes report, “…beyond manufacturing, subsidies of up to $8,800 are being offered to taxi fleets and local government agencies in 13 Chinese cities for each hybrid or all-electric vehicle they purchase. The state electricity grid has been ordered to set up electric car charging stations in Beijing, Shanghai and Tianjin. China is tackling the challenges (of the hybrid and EV market) with the same tools that helped it speed industrialization and put on the Olympics: immense amounts of energy, money and people.”     China is thus taking strong steps in ramping up the hybrid and EV development and production.

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