Hybrid Engine Vehicles to be Manufactured by Toyota in Melbourne

11 Jun 08

The Rudd Government will give Toyota $35 million to produce hybrid Camry vehicles at its Altona plant in Melbourne, the Prime Minister Kevin Rudd announced.

Mr Rudd made the announcement in Japan late yesterday morning, as Victorian Premier John Brumby also revealed details of the project for green petrol-electric cars.

Experts tipped Toyota's plans for a hybrid car would trigger a green technology race by other car makers.

The move will give Victoria's spluttering car manufacturing industry a huge boost by building a new green model in Melbourne.

Toyota hopes to make 10,000 of the hybrid cars each year at its Altona plant in Melbourne providing a much needed boost to the local industry that has been welcomed by the peak body representing Australia's automotive industry.

The Federal Chamber of Automotive Industries has described Toyota's announcement as a "tremendously significant and exciting development for the Australian car industry".

"It demonstrates that local car manufacturers are embracing the challenge of producing low emission, more fuel efficient vehicles in Australia," chamber CEO Andrew McKellar said.

"It shows that they are serious about achieving improved results for the environment and investing in the future."

Mr McKellar says he expects the hybrid Camry to be warmly embraced by the public.

"Pricing is yet to be determined, but inevitably with any new technology we will see the price come down over time. So, I expect that when we see significant production of these vehicles in Australia, they will be competitive."

The new hybrid was just one type of car in a whole range of options being considered to reduce petrol usage, including a shift to diesel, he said.

"Certainly with diesel, there are significant improvements in terms of fuel efficiency available, 30 to 40 per cent, so that's one of the options that is being looked at."

Unions have also embraced the deal.

The Australian Manufacturing Workers' Union (AMWU) said the deal was good news for Australia's export future.

“Any announcement regarding the production of green cars is a good announcement,'' AMWU national secretary Dave Oliver said to ABC Radio.

“We've been saying for some time we need a plan for this industry as we start to consider the type of vehicles people will be driving in the next 10 to 20 years.

“Not only for the domestic market but to position itself for export strategies.''

Car industry experts say today's expected announcement will lead to an explosion of green car technology locally.

“The kind of response it's going to trigger from other manufacturers is to look at their own products and how they can be made more environmentally friendly,'' Monash University manufacturing specialist Richard Cooney said to ABC Radio.

“If this gives Toyota a leg-up in terms of the fleet market for vehicles then other automotive manufacturers are going to have to look at what Toyota is doing and find a business strategy to match that.''

Having a hybrid car built in Australia would give local designers, engineers and manufacturers access to the latest green vehicle technology, Dr Cooney said.

“It keeps Australia in the loop.''

But not all parties feel the $35 million contribution by the Rudd government was necessary. Reports have begun circulating that Toyota had planned to introduce a hybrid version of the Camry soon anyway forcing the Prime Minister to defend the funding decision.

Toyota has been explicit about its wish to produce a hybrid version of the Camry in Australia since the model went on sale in Japan two years ago.

But putting aside the politics of allocating the funds, this decision by Toyota and the government appears to have the potential to revitalise the local industry by offering an Australian produced car that more Australians are likely to want to purchase as fuel prices continue to rise.

In what can also be seen as an international endorsement for the governments decision to fund the Camry hybrid development, a top Ford Motor Co. executive urged the U.S. government to make a greater commitment to the development of plug-in hybrids on Wednesday, warning that the country was falling behind in developing the technology critical to the advanced vehicles.

Mark Fields, Ford's President of the Americas, said at a conference on plug-in hybrids that bold incentives are needed to speed up the development of advanced batteries that are key to the vehicles.

''The governments of Japan, China, Korea and India are all significantly funding the research development and deployment of plug-in hybrid vehicle technologies. This is a race we absolutely must win,'' Fields said.

''It seems clear that a business case will not evolve, in the near term, without support from Washington,'' he said at the conference, sponsored by the Brookings Institution and Google.org, Google Inc.'s philanthropic arm.

Fields said most of the battery supply is being developed in Asia, underscoring the need for a government-industry partnership to help develop the next generation batteries and help automakers upgrade their factories to build the cutting-edge vehicles.

''For those looking to plug-ins to answer our energy security concerns, we must ensure that we have a domestic battery supply. Moving from imported oil to imported batteries clearly would not address this growing concern,'' he said.

The conference, which featured displays of plug-in vehicles, drew several car manufacturers, technology firms and alternative energy advocates who have been urging a larger commitment from government given record-setting fuel prices and the nation's dependence upon foreign oil.

Democrats in Congress have sought a $3,000 tax break for consumers to buy a plug-in hybrid, but many speakers said a broader number of incentives was necessary.

''We don't have time to wait. We can't have this happen slowly,'' said Felix Kramer, founder of CalCars, a California company that developed plug-in hybrids.

Several car makers are testing plug-in hybrids that could allow owners to plug the vehicle's battery into a standard wall outlet to recharge it. General Motors Corp. is developing an extended-range plug-in electric vehicle called the Chevrolet Volt which it hopes to launch in 2010.

Toyota Motor Corp., meanwhile, announced Wednesday that it would introduce a plug-in hybrid with next-generation lithium-ion batteries by 2010 that will target leasing customers.

Ford has a demonstration fleet of 20 plug-ins through a partnership with Southern California Edison. The companies are studying ways to accelerate mass production of the hybrids.

Fields said the company's plug-in, which has a 10 kilowatt advanced lithium ion battery, could average 120 miles to the gallon while the vehicle runs on mostly electric power for the first 30 miles (48 kilometers) the vehicle is driven after a complete charge.

But he said they are trying to improve the battery's durability, ensure its quality and make it more affordable. Ford has not given a firm date on when it expects to mass market the vehicles, but said last year that it could take 5 to 10 years.

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