Battery Woes for Toyota

Toyota Denies Battery Woes Delay Prius

By YURI KAGEYAMA 09.28.07, 9:26 AM ET

TOYOTA, Japan -

Introduction of the next version of Toyota's hit Prius gas-electric hybrid won't hinge on the development of a more efficient battery called lithium-ion, a senior Toyota executive said Friday.

The executive brushed off a recent Wall Street Journal report that said Toyota Motor Corp. (nyse: TM - news - people ) was delaying the launch of the next-generation Prius by as much as two years because of problems in developing the lithium-ion battery. Hybrids on sale now use nickel-metal-hydride batteries.

The Toyota official, who requested anonymity because he is not authorized to speak on the matter, said various innovations for the next Prius are being considered - not just the lithium-ion battery.

He said some type of lithium-ion battery is preferable for hybrid vehicles because they are lighter and pack more power than nickel-metal-hydride batteries. He acknowledged that the lithium-ion battery had not been perfected.

But he denied that the problems Sony Corp. (nyse: SNE - news - people ) had with its laptop lithium-ion batteries raised safety concerns at Toyota, as the Journal had reported, stressing that potential battery problems were long known to Toyota engineers. Sony recalled millions of laptop batteries after reports of fires.

Hybrid competition is intensifying as gas prices and environmental concerns escalate.

Last month, General Motors Corp. (nyse: GM - news - people ) said it had signed an agreement with A123 Systems Inc., a battery maker that already produces millions of lithium-ion batteries for use in cordless power tools.

At that time, GM Vice Chairman Bob Lutz said the technology could be applied to autos, giving GM a chance to beat Toyota in the race to bring plug-in hybrid and electric cars to market.

Toyota's hybrid vehicles, which deliver better mileage by switching between a gas engine and electric motor, have been a huge hit. The automaker has sold more than a million hybrid vehicles around the world in the past decade - more than any other automaker.

Toyota, has not given a sales date for the world's most popular hybrid, which first went on sale in 1997.

Copyright 2007 Associated Press. All rights reserved.