Plug-in hybrids: Not ready for primetime
Making an affordable hybrid car that can be charged from an outlet isn't as easy as just adding cord.
By Peter Valdes-Dapena, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- As car buyers search for more fuel-efficient alternatives, interest in plug-in hybrids is increasing.

Ordinary hybrids, like the Toyota Prius, use power from the vehicle's gasoline engine to charge batteries that in turn power electric motors. When these hybrids were first introduced, people had a hard time understanding that they did not need to be plugged in to get needed electricity.

Plug-in hybrids, however, can get their power from the same outlet that charges your cell phone or electric razor. That option greatly reduces reliance on gasoline.

And a plug-in hybrid could drive on pure electric power for many miles before the gasoline engine would even need to turn on, offering the benefit of an electric car without the downside of limited range, promotors say.

Some like to say that plug-in hybrids can get up to 100 miles per gallon of gas -- though such estimates depend on how far you drive before recharging the battery. At any rate, fuel economy would be significantly improved even over an ordinary hybrid vehicle.

Toyota Motor Co. recently announced that the company was working on plug-in hybrids. CNNMoney.com recently reported that General Motors is also working on the technology, although the company now says it cannot confirm that report. A recent story in Business 2.0 reported on two small companies that are planning to sell kits to convert Toyota Priuses and Ford Escape Hybrids into plug-in hybrids.

The challenges

It sounds simple. Just take a hybrid car and add a plug. So why are car companies still "working on it?"

Batteries: The biggest challenge is the battery. The batteries now used in hybrid cars like the Toyota Prius and Ford Escape Hybrid aren't actually very good at storing electricity. They don't need to be because they are constantly being recharged.

Those batteries are ideally suited for holding electricity for short periods of time. They are never fully charged or fully discharged. In that way, hybrid vehicles currently on the market are engineered to have a long, easy life. Hybrid Escapes and Priuses in fleet use have gone hundreds of thousands of miles without their batteries ever giving out, spokesmen for Ford and Toyota have told CNNMoney.com.

To be really useful, plug-ins would need a different kind of battery, one that could swallow a lot of electricity and hold it for later use. But that kind of use tends to significantly shorten a battery's life.

Expectations: Consumers will also need to be educated about how the vehicles will work. Many seem to think that a plug-in hybrid will operate just like an all-electric vehicle for many miles until battery power runs down. Only then will the gasoline engine begin to run.

"The way the hybrid systems are designed they really don't have enough electric drive power to do that," said Mike Tamor, executive for hybrid and fuel cell research at Ford Motor Co. "Not by a long shot"

To make a vehicle capable of that would increase costs to the point where the vehicle would make little economic sense, said Terry Penney, manager for vehicle technologies at the National Renewable Energy Laboratory.

"Then you basically have to design two powertrains," he said. "That's just silly."

Instead, plug-ins will run on electric power up to a certain speed - say, fast enough to drive on level suburban roads - but the gasoline engine will still kick in when speeds get higher. However, fuel economy will still be greatly increased because the gasoline engine will be freed from having to charge the battery.

Cost: Currently, the cost difference between a hybrid vehicle and an identical non-hybrid version is about $3,000 to $5,000. The cost difference for a plug-in hybrid could be twice that, experts say, mostly because of the larger, costlier batteries. (Tamor, of Ford Motor Co., called that estimate "extremely optimistic" based on current technology.)

Hymotion, a Canadian company that offers kits to retrofit Toyota and Ford hybrid vehicles for plug-in use, currently charges about $12,000 for a kit. The company hopes to lower that price to half that much by next year, said president Ricardo Bazzarelle.

Even then, that cost will come on top of the premium paid for the hybrid system in the car itself, resulting in a total premium of about $10,000.

With current battery technology, consumers could also face the cost of buying replacement batteries, something owners of current hybrid vehicles will probably never have to deal with.

Hymotion currently guarantees its battery, which operates independently from the battery already built into the vehicle, for two years, according to its Website. The company says it may stretch the warranty as more usage data comes in.

The road ahead

The two most difficult challenges facing researchers, for the time being, will be battery cost and life span.

"They need to get a better handle on long term reliability with the extreme charge and discharge cycles," Ron Cogan, editor of the magazine Green Car Journal, said of battery researchers.

Ford would not sell a plug-in hybrid unless it could guarantee that the battery would last as long as current hybrid batteries do, said Tamor. He's confident that challenge can be met, though.

Batteries are used for all sorts of modern applications so there is impetus to find breakthroughs from every quarter.

"We can't see that path clearly," said Cogan. "There's a lot of work going on behind the scenes."

Batteries used for other applications, like laptop computers, could be adapted in large numbers for use in cars, he said.

One likely future, said Cogan, will be that people can purchase hybrid vehicles that are specifically tuned to economically meet their personal driving needs.

For example a customer who drove only a few miles to work and back most days would pay less and get a vehicle with a smaller battery pack. Someone with a moderately long commute would pay more for bigger batteries or might get a vehicle that never runs on "all electric" mode but, instead, spreads the electric assist out over a longer distance. That would result in less fuel savings, but much lower cost for the vehicle since the batteries wouldn't need to be as big.

In the end, said Cogan, answers will likely come through more research and through simple creativity.

_________________________

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.