Mike Stevens | Jul 27, 2009

DESPITE THE SUCCESS of diesel engines in Europe and a growing popularity in the US and Australia, Toyota is betting the farm on hybrid technology for future fuel economy gains.

The world's number one carmaker has halted diesel programs for its volume selling passenger vehicles because of increasing technology and manufacturing costs.

Diesel engines, which typically offer fuel economy figures 20 to 30 percent better than petrol engines of equivalent capacity, add a higher purchase price to a new car.

Dave Buttner, Head of Sales and Marketing for Toyota Australia, told News Ltd that while diesels will still appear in the likes of the LandCruiser, HiLux and HiAce, the company's passenger vehicles will continue the move towards hybrid technology started by the Prius and the upcoming locally-built Camry hybrid.

The HC-CV (Hybrid Camry Concept Vehicle), developed locally by Toyota Style Australia

The Japanese carmaker also announced recently that it would soon begin manufacturing a hybrid version of its Auris small car - sold in Australia as the Corolla - and while no plans currently exist to offer this hybrid model locally, Toyota Australia has not ruled it out.

Other manufacturers such as BMW, Peugeot, Citroen and Volvo are busily developing hybrid (both petrol and diesel) and electric vehicles to sell alongside petrol and diesel models.

"The smart play is to hedge your bets by having entries in both categories," Diesel and Hybrid Powertrain Analyst, Michael Omotoso, of J.D. Power and Associates, said.

"There's still a lot of perception that diesels are dirty, so the strategy for some manufacturers is to have hybrids for those who think diesels are dirty."

In June, it was reported that Toyota would also be steering clear of diesel-electric hybrid engines, despite growing interest in the technology, particularly in Europe.

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