Realizing that they're late to the hybrid game, GM, DaimlerChrysler and BMW have announced a three-way research and development collaboration in which they'll be spending $1 billion on gas-electric hybrid powertrain technologies.

The clear leader in the field is Toyota who expects to sell its millionth hybrid vehicle globally next year. Ahead of the game, they reportedly spent their $1 billion in research in the '90s to develop their first hybrid.

The collaboration will focus on a system of common hybrid specifications mated to a GM automatic transmission. In addition, the companies will be using a single GM plant in Baltimore to build the hybrid systems.

Phil Gott, an analyst with Global Insight, says, "You could say it puts them ahead (of Toyota). You have three manufacturers sharing the research and development and the manufacturing. That means they should have a lower cost structure."

Catching up to Toyota would be no small feat. The Japanese auto giant reduced hybrid technology costs by 50 percent with the 2004 Prius compared with the original 1997 version, and they expect another 50 percent reduction of costs within the next 5 years or so. Toyota says they will eventually offer hybrid versions of all its vehicles.

We should see the first results of the American-German joint venture in late 2007 in the form of a hybrid Chevrolet Tahoe and GMC Yukon. DaimlerChrysler says it first plans to offer a hybrid Dodge Durango in 2008 and will later adapt the system for Mercedes.

There is speculation that Ford, the first U.S. auto maker to offer a hybrid vehicle, will eventually join the collaboration, but nothing has been confirmed. As of now, Ford is planning to offer hybrid versions of the Fusion and Mercury Milan in 2008.

[Source: Chicago Tribune]