Johnson Controls sees hybrids making inroads

Over the next decade, hybrid engines could be put into five to eight percent of new cars built worldwide, a top executive at auto parts supplier Johnson Controls opined. That would mark exponential growth from their current market share of less than one percent. Gregg Sherrill, group vice president and general manager of power solutions, saw hybrids playing a significant role in the future. Johnson makes batteries used in hybrid cars.

Hybrid cars, which couple a traditional internal combustion engine with an electric motor and batteries to save petrol, currently account for about one percent of new car sales in the United States. This figure is reflected in other markets where hybrid cars are available, as well. Sherrill said that the key to increasing hybrids' share of the market will be lowering their cost. He said that the hybrid battery systems his company sells to car makers cost from $800 to $1,600 (Rs 36,800 to Rs 73,600) compared with $25 to $30 (Rs 1,150 to Rs 1,380) for a traditional car battery.

He attributed the high costs to a lack of economies of scale. However, once the initial hype had died down he expected volumes to rise and costs to come down substantially. In addition to selling batteries for new hybrid cars, Sherrill said the company would also have a chance to sell replacement batteries. The batteries used in hybrid cars are warranted to last for about 100,000 miles (160,000 kilometres).