VW plugs in to hybrids with Porsche launches in 2013

BERLIN Thu Dec 13, 2012 2:06pm EST

File photo of CEO Michael Macht of German car manufacturer Porsche standing beside a Porsche 918 Spyder car and a Porsche Cayman (back) car during the first media day of the 80th Geneva Car Show at the Palexpo in Geneva March 2, 2010. REUTERS/Denis Balibouse/Files

File photo of CEO Michael Macht of German car manufacturer Porsche standing beside a Porsche 918 Spyder car and a Porsche Cayman (back) car during the first media day of the 80th Geneva Car Show at the Palexpo in Geneva March 2, 2010.

Credit: Reuters/Denis Balibouse/Files

BERLIN (Reuters) - Volkswagen will start selling its first plug-in hybrid models next year to sports car lovers as the German automaker plays catch-up with hybrid-vehicle champion Toyota Motor Corp.

VW expects growing demand for the fuel-saving technology and will target wealthy buyers with initial launches of plug-in hybrid versions of the Porsche Panamera coupe and the 918 Spyder sports car, VW's electric car chief Rudolf Krebs told Reuters.

"Plug-in hybrids offer the best of the two worlds (of purely electric drives and combustion engines)," Krebs said. "This technology will soon be visible on the roads. That's why we really want to get weaving."

Europe's biggest car maker is a late starter on electric powertrains after arguing for years that clean diesel is a better fuel-efficiency strategy than hybrids, which combine a combustion engine with battery-powered electric propulsion.

Toyota, the world's no. 1 car maker, introduced the Prius hybrid compact vehicle in 1997, 13 years before VW's Touareg hybrid SUV came to market in 2010, and started delivering a Prius plug-in version this year.

Faced with caps on carbon-dioxide emissions in core European markets and a drive by rivals for the most ecological powertrains, VW wants its share of the growing euphoria for plug-in hybrids that can travel longer distances on battery power than ordinary hybrids and can be recharged in public.

"This is a long-term trend that can no longer be reversed," Krebs said, noting that VW will commit a "considerable" amount of over 7 billion euros of annual spending on research and development to electric mobility.

"The planned offensive on plug-in hybrids will become a core element of our future strategy."

A stronger push by VW into plug-in hybrid technology could also wrongfoot French rival Renault (RENA.PA) and Japanese affiliate Nissan (7201.T) which have staked the most on purely electric cars among major auto companies, investing 4 billion euros in their development and production.

Sales projections suggest VW may be backing the right horse.

Global production of plug-in hybrids may soar more than eight times to 960,644 vehicles by 2018 from 118,961 in 2013, according to research firm IHS Automotive.

By contrast, sales of purely electric cars, shunned for their high prices and limited driving range, may increase fewer than threefold in that period to 627,816, IHS said.

VW plans to roll out plug-in hybrid versions of its best selling Golf hatchback in 2014 and the Passat model, flanked by the Audi Q7 SUV, A3 compact and the Porsche Cayenne SUV, according to Krebs. The Audi A6 sedan and A8 flagship model will follow in subsequent years, he added.

"We will take this pioneering technology out of its niche and make it accessible to as many customers as possible," Chief Executive Martin Winterkorn said at the Paris auto show in September.

"They're trying to get a foot into the door because Toyota and other rivals won't be caught napping," said Hanover-based NordLB analyst Frank Schwope. "But it will be a long battle." (Editing by David Cowell)