The hybrids are coming

Bold holiday prediction: By 2010, half of new cars sold in the US will use hybrid gas-electric engines.

We have one, a Toyota Prius, and it’s fantastic. The only difference you notice from a traditional car is that it gets >50 miles per gallon. Fuel cells get all the hype, and they will eventually be the dominant technology. But that transition will take decades, if for no other reason than the need to build hydrogen fueling stations everywhere. Hybrids are ready to go today.

A constellation of factors are coming into play: maturing technology; ongoing worries about oil supplies amid Middle East instability; pressure to increase gas taxes for revenue generation and conservation incentives; competitive pressure from Japanese car makers; and the coolness factor. There are few hybrids on the road today in the US, but expect an onslaught beginning in late 2003. GM, which has been a laggard, just announced it will put hybrid engines in five of its models by 2007.

Things move slowly in the car business, but once trends start they become inexorable. Witness the SUV invasion. Remember, this is one of the world’s biggest industries, generating hundreds of billions of dollars (if not trillions) in global revenues. And we’re talking about the first major shift in engine technology in a century.