July 15, 2008

Chrysler Plans To Manufacture Electric Vehicles

Chrysler LLC plans to be selling all-electric vehicles within the next three to five years. 

The new Envi division of Chrysler was started last September and is developing vehicles that can run on battery power for up to 40 miles.

"The group is looking to have a product available in the marketplace in the next three to five years," Nick Cappa, a Chrysler spokesman, said on Monday.

Chrysler has fallen behind rivals when it comes to a hybrid strategy but is now working on a new generation of hybrid vehicles that will run on lithium-ion batteries. The batteries are lighter and more powerful than the competitors nickel-metal hydride batteries.

The company has not made public any partnership for the project.

Toyota Motor Corp and General Motors Corp are currently trying to create rechargeable hybrids that use the lithium-ion battery.

General Motors' Chevy Volt line is scheduled to be available in 2010 while Toyota has stated that it will soon be testing a version of the Prius hybrid that will be rechargeable.

Ford plans to have a mass-market electric hybrid in the next 5 to 10 years.

Lithium-ion batteries are the standard in consumer electronics but automotive companies have had to deal with a large range of problems with the batteries, including adapting them to power cars, and battling the risk of the batteries overheating.

Chrysler displayed three concept cars at the Detroit auto show in January. The EcoVoyager, Dodge ZEO and Jeep Renegade are all intended to run on lithium-ion batteries.

"Chrysler will produce technology similar to one of them or a combination of the three," Cappa said.

Chrysler, which was bought by private equity group Cerberus Capital Management last August, made the shift to hybrid vehicles after the company watched the sales of their SUV's and trucks rapidly decline due to rising gasoline prices.

The Michigan based company relies on the sales of SUV's and trucks for almost 70 percent of its total sales. 

The consumer market is currently purchasing fuel-efficient hybrids and shifting away from the larger gas consuming SUV's and trucks.  The shift has led automakers to invest in developing electric vehicles and hybrids.

Toyota currently dominates the American hybrid market mainly because of the strength of its Prius model.  The company plans to be selling over 1 million hybrids a year by the beginning of the next decade.


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