For Toyota, it's a question of whether the tank is half-empty or half-full. The automaker is the unquestionable leader in the fast-growing U.S. hybrid-electric vehicle market. But HEVs are coming under increasing criticism for failing to deliver the sort of mileage manufacturers like Toyota are promising.



The Japanese automaker's Prius has become the world's best-selling hybrid, while the U.S. has become Toyota's biggest market for the gas-electric midsize sedan, accounting for about 60 percent of worldwide Prius sales. With additional hybrids coming into production, such as the recently launched Lexus RX400h, Toyota is looking to sell one million hybrids annually by 2010, according to Don Esmond, senior vice president of automotive operations for Toyota Motor Sales, U.S.A., Inc., and "if you put a pencil to that, (the U.S.) would be doing 600,000."



The question is what it will take to get there. While the recent run-up in U.S. fuel prices has made the economic equation for hybrids increasingly attractive, that may not be enough to nurture a truly mass market. And in the coming years, Toyota and its Lexus luxury arm are likely to shift focus to expand the appeal of HEVs, according to senior company officials.



After a slow and uncertain start, many analysts have come to agree that hybrids are gaining momentum, aided in part by the run-up in U.S. fuel prices. But other observers remain skeptical.



"We see the general desire for these types of vehicles growing," said Jeff Martini, vice president of the Polk Center for Automotive Studies. "However, the compelling argument to actually buy one has to be made more strongly," he added.



Critics contend that the cost of hybrid hardware - generally adding $4000 to $9000 to the price of a comparable gasoline-only vehicle - is difficult to offset through increased mileage, even with $2.50-a-gallon gasoline. "When you just use the argument of fuel efficiency, the purchase of a hybrid car is not justified," acknowledged Kazuo Okamoto, the new head of R&D for Toyota Motor Co., in a recent interview with London's Financial Times.



The equation is only more off-balance when real-world, rather than promised, mileage is taken into account. While Toyota claims Prius gets close to 60 miles per gallon, consumers report it more typically delivers around 40 mpg. Esmond admitted there is a notable fuel economy gap, but insisted it is the result of government tests automakers rely on, rather than any attempt by Toyota to mislead its customers.



And indeed, other hybrid manufacturers, such as Honda, concede similar discrepancies. But none of the HEV makers is willing to provide a more realistic figure, said Honda planning director Dan Bonawitz, because the higher numbers are "a competitive advantage."



Perhaps, but the growing chorus of complaints could sour current and potential owners, some analysts warn. And as a result, manufacturers are looking at other ways to boost the appeal of hybrids. Honda, for example, has been emphasizing the higher performance of its Accord Hybrid, which launches from 0-60 a full half-second faster than the conventional V-6 Accord.



Lexus is also promoting the performance of its RX400h, and the luxury unit's next hybrid could usher in an entirely new line of high-performance HEVs, said the Toyota division's new general manager, Bob Carter. A final decision has not yet been made, but Lexus engineers are developing a distinctly different version of the Toyota Synergy Drive used in the Prius.



Next year's GS450h is expected to feel more like a conventional sports sedan, with a mix of software and hardware changes meant to replicate the feel of a conventional sedan going through rapid gear changes.



"You may see Toyota and Lexus going in two very different directions," Carter told TheCarConnection.com during an interview in California.



But even the Toyota division will put more of an emphasis on performance, added Esmond, during the same interview. It will put more emphasis on the other advantages of hybrid technology, such as the significant reduction in emissions, including the greenhouse gas, CO2.



While hybrids are taking some heat right now, analyst Jim Hall, of AutoPacific, Inc., doesn't foresee a serious backlash over mileage. There are "plenty of other reasons" why they'll continue to gain ground in the U.S. market, he said. In some states, hybrid owners gain access to carpool lanes, even while driving alone. Several cities now let HEVs park without paying at meters. And then there's what Hall calls "the cool factor."



For some Prius buyers, the biggest plus is the positive feedback they get driving their distinctive vehicles down the street. Ironically, Lexus seemed to miss that point with the RX400h. The most common complaint, said Esmond, is not mileage, but the fact that the gas-electric SUV is almost indistinguishable from a conventional RX330. "They want us to badge this thing so people know they are driving a hybrid," said Esmond. (Honda officials admit they've had similar complaints about their Accord and Civic hybrids.)



Toyota is in the midst of a major internal debate over whether it should produce more hybrid-only models, such as Prius, or continue offering hybrid options for its mainstream models. Whatever the ultimate decision, future Toyota and Lexus HEVs will be much more distinctive, Esmond promised.

While Toyota claims Prius gets close to 60 miles per gallon, consumers report it more typically delivers around 40 mpg.

Toyota is in the midst of a major internal debate over whether it should produce more hybrid-only models, such as Prius, or continue offering hybrid options for its mainstream models. Whatever the ultimate decision, future Toyota and Lexus HEVs will be much more distinctive, Esmond promised.

Toyota has filed a countersuit in Munich challenging the validity of the Antonov patent, originally published in 1991, for a continuously variable transmission that reacts to engine power and resistant load.

Toyota Under Fire for Hybrid Technology

A technology company is taking aim at Toyota, saying that the company's gas-electric hybrid Prius and Highlander vehicles infringe on its U.S. patents.
Solomon Technologies, Inc. announced today that it has expanded its litigation against Toyota by filing a complaint with the United States International Trade Commission (ITC) in Washington D.C. This action is in addition to the action already filed in the United States District Court for the Middle District of Florida last September.
The ITC acts as an administrative investigative body to determine, among other things, whether or not goods imported into the United States infringe U.S. patents.
Solomon president Peter W. DeVecchis, Jr., said, "The filing of the ITC complaint is the next step in our effort to fully prosecute the alleged infringement by Toyota and to protect our valuable intellectual property. We believe that the ITC's streamlined administrative process, as well as the technical depth of the ITC staff, will be helpful in expediting and supporting our claims." He continued, "While the ITC can not assess damages against an infringer, it can issue an exclusion order prohibiting the importation of infringing technology. We will continue our effort to protect our intellectual property to the fullest extent possible."
Solomon brought suit against Toyota Motor Corporation, Toyota Motor Sales U.S.A. Inc. and Toyota Motor Manufacturing North America in the United States District Court for the Middle District of Florida, Tampa Division, on September 12, 2005, claiming infringement of a number of claims in Solomon's U.S. Patent Number 5,067,932, primarily relating to Toyota's use of the technology in its Prius and Highlander Hybrid vehicles.
If Solomon were successful in its ITC action, Toyota could be prohibited from importing into the United States infringing combination motor and transmission systems and those products containing such systems, including the Toyota Prius and Highlander models.

Toyota Stands Ready To Expand Texas Plant

By NORIHIKO SHIROUZU
June 8, 2006 11:01 p.m.

DETROIT -- Toyota Motor Corp. doesn't have the green light to expand its full-size pickup truck plant in Texas, but if demand keeps up, the company stands ready to add a second assembly line, according to a senior American company executive.

Gary Convis, a Toyota managing officer and a Toyota North American manufacturing chief, said that the Japanese auto maker does not have "any defined plans" to add an additional assembly line at its pickup truck plant in San Antonio. The plant is slated to begin production later this year of a new generation of the Toyota Tundra pickup truck.

Still, "just like we did in Kentucky and just like we did in Indiana, we planned ahead so that if demand is there…, we can fairly quickly add that additional site," Mr. Convis said in a recent interview with a group of reporters.

"We already have infrastructure and the leadership team and logistics and so on" to execute such an expansion if that is deemed necessary, he added.

When Toyota's San Antonio plant hits its full capacity of 200,000 vehicles a year, Toyota will be able to produce more than 300,000 Tundras a year in the U.S., counting capacity at an existing factory producing Tundras in Princeton, Ind.

It's not clear what product Toyota might decide to build in San Antonio in addition to the redesigned Tundra truck, but company executives have said in the past they were considering a beefier version of the Tundra to compete with trucks like Ford Motor Co.'s F-250 pickups.

Write to Norihiko Shirouzu at norihiko.shirouzu@wsj.com1

Five things I learnt this weekend in a Toyota Hilux in central London:

1. The phrase 'between a rock and a hard place' takes on a whole new significance when impossibly wedged in an underground car park between a Ferrari 360 Modena and 911 Turbo.

2. Drive a giant pick-up with tinted windows and fellow drivers will always let you out at junctions. They will assume you're a gap-toothed redneck with a pickaxe on the back seat.

3. There is great satisfaction to be gained in fitting five peoples' monthly shopping onto an open load deck. There is less satisfaction in watching an opportunistic thief stealing said shopping at the red lights.

4. Don't forget to turn the diff off when parking unless you want to draw a crowd of bemused bystanders as the wheels skit in every direction.

5. Hate mail from south London residents concerning the legality of parking pick-up trucks on the side of the road can be frightening.

OK, it was a chastening experience, but in a mildly masochistic way I enjoyed driving the new dual-cab Hilux. Granted, it's not the ideal city runaround: attempting to parallel park on a side street is like trying to surreptitiously moor the QE2 in a duck pond. But for a pick-up truck it's surprisingly easy-going and refined.

Given its gargantuan wheelbase, the Hilux is gentle enough to drive. The low-revving, torquey 3.0-litre diesel engine is even reasonably economical - I managed to get over 30mpg around town even with the auto 'box.

Admittedly the ride is a touch crashy and you'll struggle to see off a horse and cart from the lights, but the top-specced Invincible model comes with a brilliant satnav and it still feels as indestructible as ever.

And a brand new dual-cab costs less than 15 grand. That's a lot of metal for the money.

The Hilux will never top a Smart ForTwo for urban practicality, but only an idiot would ever buy one for use in central London. The same sort of idiot, in fact, that manages to get wedged in an underground car park. For an entire afternoon.