Hybrid Automobile Industry - Term Paper Example

When considering the R&D collaborations in the Hybrid Automobile industry, the pioneer to manufacture and commercialize the hybrid concept was Toyota Motor Corp, offering Prius model to the market in 1997. Although most automakers were not convinced then on the potential for a gas-electric hybrid concept, especially with the high price tag attached, the popularity of the Toyota’s Prius has forced the auto industry to consider this technology seriously. “Prius, which was Motor Trend magazine's car of the year for 2004 has become a pop culture icon” (Schneider 2004).

Thus, with the consumer interest in hybrid cars indicated an unanticipated level of enthusiasm, the automakers are keen to acquire the technology, which will allow them to market their own brands. However, with over a decade of the time lag between the pioneer of the technology, manufacturers have realized the need for strategic R&D collaborations in order to catch up for lost time. The substantial costs associated with R&D activities in developing a new technology concept reflects upon the product’s prices and therefore, automakers have to find avenues in managing such costs associated in developing their versions of the hybrid car.

This aspect too has contributed to the strategic R&D collaborations in the automotive industry for the hybrid cars.“ Currently, the PSA Group, Honda and Toyota are the only vehicle manufacturers to market hybrid electric vehicles extensively” (PR Newswire Europe 2006). Once Toyota offered the Prius through it’s Hybrid Synergy Drive program to the market, consumers responded with enthusiasm and with social consciousness manner towards the environmental benefits associated with the hybrid vehicles.

“HSD is a refinement of the original Toyota Hybrid System (THS) used in the 1997–2003 Toyota Prius” (Toyota Hybrid 2006).Ford Motors realized the potential of the market segment and embarked on developing their own version, tapping on to Toyota’s technology through licensing agreements. “ Ford entered into a licensing agreement in March 2004 allowing Ford to use 20 patents from Toyota related to hybrid technology, although Ford's engine was independently designed and built”