Inside Line: Toyotas by Fuji: Subaru Parent Will Build Toyotas in United States -

100,000 Bottles of Camry on the Wall . ..
Toyota will Build Camrys at Indiana Subaru Plant - Or Won't they?

Edmunds.com is citing the Wall Street Journal and stating that Toyota & Subaru have cut a deal. The Detroit Free Press is saying maybe. Yesterday, a Subaru spokesman said that there were negotiations but no definitive deal.

In separate news, Toyota is considering building an engine plant in Michigan. When you're hot, you're hot. . .

The interesting thing between the Subaru-Toyota hook-up is the four-wheel-drive angle. As you know, for about a decade, all Subarus have been four-wheel-drive. Toyota wants the factory space to build a hybrid version of the Camry. In the Lexus RX-400h hybrid SUV, the rear wheels are not driven by a drive shaft or any mechanical system, the rear wheels are electric only. A hybrid system driving the rear wheels, batteries and all, is not significantly heavier than a conventional 4wd driveline. When mass produced it might not be any more expensive.

I've written before about the experience curve in relation to hybrid vehicles, and here's where it really kicks other technologies in the pants. For the type of 4wd that the average person needs, electric drive, at least for two of the wheels, kicks competing technology in the pants, and it's going to take over the market. For roughly the same cost, instead of getting a car with inferior mileage than a 2wd version, a hybrid 4wd car gets better mileage and performance. The bottom line to all this - within about two years, Toyota could be flooding the market with another 100,000 Camrys. Within two years after that, another 200,000 Subarus and Toyotas could be coming off the assembly lines in Lafayette, Indiana. The Legacy and Camry may share the same 4wd platform by then, a platform that in hybrid 4wd trim could provide all-weather traction, go 0-60 in about 7 seconds and return 35 mpg in mixed driving.


Inside Line: Toyotas by Fuji: Subaru Parent Will Build Toyotas in United States -