Report: Nissan planning luxury hybrid in 2010

updated 5:18 p.m. ET March 23, 2009

TOKYO - Nissan Motor Co. will offer a luxury gas-electric hybrid for the U.S. and Japanese markets next year, Japan's top business daily reported Sunday, as competition intensifies in the green technology.

Nissan's Tokyo headquarters were closed for the weekend. Automakers are generally tightlipped about specific product plans, but Nissan already has shown prototypes of their hybrid models.

Nissan has fallen behind Japanese rivals Toyota Motor Corp. and Honda Motor Co. in developing its own hybrids but has made no secret of its ambitions to play aggressive catchup.

It now buys hybrid systems from Toyota for the Nissan Altima hybrid but is promising a vehicle packed with Nissan's own hybrid system by 2010.

Nissan is developing a different kind of battery for hybrids from those used by Toyota and Honda. Nissan officials say their battery is better at providing quicker and more power.

The Nikkei, which did not cite sourcing, said Nissan's hybrid system will be offered for the luxury Infiniti M, sold as the Fuga in Japan. Nissan plans to expand hybrid offerings to other luxury models and sports cars, the report said.

Nissan officials have said the nation's third-biggest automaker is working on a bigger hybrid system than Toyota's popular Prius, the global top-seller among hybrids, and will make hybrid sports cars and luxury models.

Among luxury cars, Toyota already offers various Lexus hybrids, while German automakers Daimler AG and BMW AG are planning hybrids.

In recent months, competition among lower-end hybrids has heated up with a major challenge to the Prius' dominance from Honda's hit Insight.

Hybrids deliver better mileage and reduce global warming gas emissions, compared with ordinary cars, because hybrids switch between a gasoline engine and an electric motor to deliver gas-sipping efficiency.

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