Holden To Build Local Hybrid

Sydney Morning Herald

Saturday May 24, 2008

Joshua Dowling

IT MAY have lost the new-car-sales race for the past five years but Holden could beat Toyota to producing the first Australian-made petrol-electric hybrid vehicle.

Toyota Australia is negotiating to assemble a hybrid version of the Camry at its Altona factory after 2010. General Motors has announced its plans are already well- progressed (concept car is pictured).

Holden, which last year sold more V8s than any other time in its 60-year history, confirmed earlier this week it will sell a petrol-electric Commodore "within two years" - beating Toyota's target.

Nick Reilly, the General Motors Asia-Pacific boss, made the surprise announcement while here for an annual review. "Our strength in hybrids tends to be in the larger vehicles, so that's where you'll see them first," he said. "[A hybrid Commodore] could be one of the first hybrids that you will see. I would put a time frame on that of probably a couple of years," he said.

But Holden wants the Federal Government to give hybrid cars a tax break. Toyota Australia has also made the same request in recent years and so far has not been successful. Toyota insiders say that a lack of tax relief is the stumbling block for local production of the Camry hybrid but Holden executives confirmed this week that the hybrid Commodore is coming with or without government assistance.

Hybrid vehicles cost about 20 to 30 per cent more than a car with a regular petrol engine. The price of the hybrid Commodore is far from confirmed but it is likely to cost more than $40,000. The basic Commodore V6 costs $35,000.

Typically, hybrid cars do not make financial sense. Fuel savings usually don't cover the vehicle's price premium. Using the national annual average distance travelled of 15,000km, it would take up to nine years to recoup the cost in fuel savings.

The cheapest petrol-electric car sold in Australia is the Honda Civic Hybrid, which went on sale in 2004 priced at $30,000. This has since crept up to $32,990 but is still cheaper than Toyota's Prius hybrid, which costs between $38,000 and $44,000. The Prius outsells the Honda by more than two to one. To date, about 3500 Honda hybrids have been sold in Australia compared with more than 9000 Priuses.

Reilly said not all buyers were prepared to pay a premium to drive an eco-friendly car. "Hybrids don't make sense unless you have incentives. Part of our submission to the Federal Government review into the automotive industry is that there should be some benefit to the consumer."

He said the government should consider tax reductions for so-called "green cars".

© 2008 Sydney Morning Herald

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