[pagebreak:Can Hymotion Convert the Auto Industry?]
The first commercial plug-in hybrids are on their way, and they might not be coming from General Motors or Toyota.
Hymotion this week began taking Web orders for a conversion kit, called the L5 Plug-in Conversion Module, that will enable Toyota Prius owners to recharge their hybrids at electrical outlets.
By replacing some fuel with electricity, drivers will be able to get more than 100 miles per gallon, the company says, well over the Prius’ 46 miles per gallon.
Of course, orders aren’t the same as deliveries, and Hymotion – which was bought by A123Systems in May -- hasn't said when it will produce and deliver the kits, which cost $9,995, including installation, plus an extra $400 “destination” fee.
And once customers receive the kits, they still will need to have them installed by one of a network of certified installers, the company says.
But the news is significant because it marks the first plug-in hybrids for the consumer market. And even though it’s unclear how large the production numbers will be, industry watchers say the move could have an impact beyond the number of conversions it puts on the road.
After all, taking orders – and $1,000 deposits -- is a way to test market demand, and major car manufacturers likely will keep watch to assess consumers' appetite for their own plug-in products.
Felix Kramer, founder of CalCars.org and an advocate of plug-in hybrids, said the news is a landmark for the electric-car industry and that it marks the first time an aftermarket conversion company is targeting the consumer market in large volumes.
About 150 plug-in hybrids cruise U.S. roads, Kramer said, adding that most of the vehicles are owned by utilities, research institutions and a handful of early adopters.
Several companies, including GM and Toyota, have been developing plug-in hybrids, but automakers and analysts have said the batteries are still too costly for mainstream vehicles (see More Speed Bumps for Electric Cars?).
Founded in 2005, Hymotion is using an A123 lithium-ion battery, which uses its parent company’s proprietary doped-nanophosphate technology to improve power density while reducing the battery’s risk of overheating and catching fire.
The battery is designed to fit into the bottom of the trunk, in the area where the spare tire normally sits. The car's bumper also has a plug.
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No matter how eco-auto savvy they are, customers won't be able to install the conversion system themselves, Hymotion warned. Drivers will have to turn to a developing network of certified installers. The first installers will be located in Los Angeles, San Francisco, Seattle, Boston, Minneapolis and Washington.
Thilo Koslowski, lead automotive analyst at Gartner, said he's intrigued by Hymotion's business model of selling kits into the aftermarket, instead of selling to automakers or manufacturing its own plug-in vehicles from scratch.
He likened the model to the secondary market that has risen to sell iPod accessories.
"We just haven't had this in the car industry," he said.
But tricking out a Prius will be a more extravagant indulgence than accessorizing an iPod.
"The cost is pretty high," Koslowski said.
Moreover, he said the launch timing isn't ideal in the softening economy. As a result, Koslowski said he doesn't expect a high sales volume for the conversion kits.
Still, big car manufactures will keep an eye on Hymotion, taking stock of the interest and demand from consumers, he said.
And the fact that a small company is willing to take the risk of entering the plug-in hybrid market could push the auto industry to move faster, he said.
But won’t increased competition be bad for Hymotion?
Kramer doesn’t think so, in any case.
"It's not correct to think there is some window of opportunity that will close once car makers are selling plug-in hybrids," he said.
While car manufacturers might take over the market for new plug-in hybrids, Kramer said he expects more than 1 million hybrids to be on the road by then, leaving Hymotion with enough of an aftermarket opportunity to carry on.
But before it can carry on, the company first needs to get started. If it can be the first to market with a kit that regular drivers can order online – and if can prove that car owners want plug-in hybrids, it could give the technology the kick start that advocates have been waiting for.