Toyota to make Electric and Gas cars

Toyota will start producing hybrid cars in Australia amid growing demand for fuel-efficient vehicles, according to local media reports.

The Japanese auto giant plans to make the Toyota Camry Hybrid in Australia in 2010 by using existing production lines for its standard Camry model, the Nikkei business daily said.

It would also start production at its Thailand plant, scheduled for later this year, it said.

The news comes as the Rudd Government urges the nation's car industry to adapt to climate change, after Holden moved to cut up to 531 jobs by ceasing production of four-cylinder engines by the end of next year.

Holden was criticised for slashing the jobs before the completion of the Bracks review into the car industry but the company insisted reduced export demand for its Family II engine had resulted in its four-cylinder Melbourne operation being reduced to less than 50 per cent capacity.

While Holden said the 27-year-old engine had reached the end of "its life cycle", Industry Minister Kim Carr said the engine would not be able to meet emission standards in its key export markets.

"This highlights the pressure on the industry as a whole to adapt to climate change and the need for fuel efficiency," he said.

Opposition Leader Brendan Nelson said it was important that every possible measure was taken to ensure Australia continued to have a car manufacturing industry.

"We think that governments need to do everything that they reasonably can to support car manufacturing in Australia," he said.

Nikkei says Toyota aims to lift production of hybrid vehicles to 10,000 units within three to four years at both the Australian and Thai plants.

The Japanese automaker was the pioneer of hybrids, which deliver power by switching between a regular engine and an electric motor. Hybrids have proven a hit, particularly in North America, at a time of skyrocketting oil prices.

Toyota is widely expected in the current year to become the world's top automaker, surpassing US giant General Motors which is in the midst of restructuring.

Toyota introduced the hybrid in 1997. Production is largely in Japan, although it has also made them in the United States and China.

Toyota's hybrid output jumped 25 per cent to 430,000 units in 2007 and is expected to soar to one million units in the early 2010s.

Meanwhile, Mitsubishi planned to launch an eco-friendly electric vehicle based on its subcompact small car in Japan next year, Nikkei said.

Annual output is estimated at 2000 cars at the start and will be raised to 10,000 in 2011, it said.
Exports were to start in 2010 to Britain, France and other parts of Europe as well as to Australia, Singapore and the United States, it said.

Officials of the two companies could not immediately be reached for comment.

Sales of eco-friendly cars have been rising not only in Japan and the United States but also in developing countries in South-East