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Reprinted from Der Spiegel
Translated from German by Christopher Sultan

Mercedes has announced plans to produce the first hybrid cars with powerful lithium-ion batteries. The cars won't roll off the assembly lines until 2009, but the Germans are hoping to break Japanese dominance of the electric-motor market.

Mercedes-Benz will unveil a new car battery this week. It uses about as much space as a conventional lead battery (meant only to start engines), but it packs a whopping 120 volts -- about ten times the power of its more ordinary cousin -- and it will be used, starting next year, in the luxury Mercedes S-Class line of hybrids.

The S-Class will be the world's first series-production hybrid car with an electric motor powered by a lithium-ion battery. Daimler hopes to position itself on the cutting edge of hybrid technology, a field where European carmakers, for years, have lagged behind their Japanesecompetitors.

The hybrid concept uses both a fuel motor and an electric motor. The electric motor stores braking energy and releases it during acceleration. This technique improves fuel economy, especially in city traffic. The magnitude of the effect is determined mainly by the battery, which has to absorb and release energy as quickly as possible, since the braking and acceleration phases are transitory.

Lithium-ion batteries are ideal for this purpose, a fact reflected in the astonishing numbers Mercedes manages to achieve. The S400 BlueHybrid comes equipped with a 279-horsepower V6 engine supported by a 20-horsepower electric motor. This engine duo delivers a top speed of 250 kilometers per hour (155 mph) and 0-100 km/h acceleration in only 7.2 seconds, and based on the European standard test, it consumes only 7.9 liters of premium gasoline every 100 kilometers (about 30 miles per gallon).

When it comes to fuel economy, this is a world record for luxury cars with internal combustion engines. The conventional Mercedes S 350, from which the hybrid model was derived, consumes 10.1 liters every 100 kilometers (23 mpg). The hybrid model is therefore more than 20 percent more efficient than its conventional counterpart -- and the power for its electric motor comes from a briefcase-sized battery. The hybrids built currently by Toyota and Honda come with nickel-metal hydride (NiMH) batteries, which take up a substantial share of the trunk.

By premiering this lithium-ion technology, both Mercedes and European industry suppliers are also celebrating a highly symbolic interim victory, after years of lagging embarrassingly behind. The battery cells are not from Asia; they're produced by French supplier Saft. The hybrid technology was integrated by Continental, the automotive system supplier which will also outfit BMW's flagship 7 Series with hybrid motors. Continental CEO Karl-Thomas Neumann calls it an "important breakthrough."

Car batteries, compared.

Continental is developing batteries capable of storing 10 times as much energy as the current model, or about 17 kilowatt hours. The new models will weigh only 100 kilograms (220 lbs) and will enable a small electric car to travel about 100 kilometers (62 miles). Substantially
higher energy densities have been achieved in the laboratory.

Mercedes also plans to position itself at the head of the class in the electric car market. A small series of all-electric Smart cars will begin rolling off the assembly lines next year, and in 2010 Mercedes plans to produce an electric version of its A-Class subcompact car. Both will use lithium-ion batteries.

Bringing Down the Cost of Hybrids

This form of energy storage, though, is still expensive. A lithium-ion battery for a hybrid car costs about €1,500 ($2,175), while considerably larger models used in all-electric cars can be 10 times as expensive. The high price is principally due to the current low production volume. But Continental's analyses predict a world market of two million new hybrid cars in 2012, which would drastically reduce production costs and improve market opportunities for electric cars.

This logic makes sense to other executives in the industry. A wave of hybrid and electric cars will enter the market in the next few years. Peugeot and Citroën plan to focus on hybrid and electric automotive technology at the Paris Auto Show in October, while Renault, Mitsubishi and General Motors are preparing to introduce their own electric cars.

There is one glaring exception to the hybrid rush -- Volkswagen, Europe's largest carmaker. CEO Martin Winterkorn may have announced that the electric car is the wave of the future, but he has hardly followed through with any significant action.

Just last week the company unveiled the latest incarnation of its top-selling model, the Golf, but neither hybrid nor electric options are in the cards. In fact, VW's activities have been limited to a small research project.

The only VW model for which a hybrid version is being developed is the company's Touareg SUV. After numerous glitches, VW now plans to introduce the vehicle in 2010. Developers at the company's headquarters in the northern German city of Wolfsburg are still using
nickel-metal hydride (NiMH) batteries.

Ironically enough, the supplier is Japanese. Honda's usual supplier, Sanyo, manufactures the (now-antiquated) battery that VW intends to use.