WASHINGTON, Nov 29, 2006 - Comtex

 

Toyota North American President Jim Press urged Congress Wednesday to extend federal tax credits for hybrid vehicles and accelerate its buying of hybrids and alternative fleet vehicles to help address energy concerns.

A 2005 federal energy bill provided up to $3,600 in tax credits to U.S. consumers who buy hybrids, but Toyota Motor Corp. this summer hit the legal production limit -- 60,000 vehicles -- that are eligible for the full tax credit.

Toyota officials said the automaker's U.S. hybrid sales in October dropped to its lowest levels since March, attributing the decline in demand in part to the reduced tax credits. The automaker also shifted production of some hybrids from Japan to the U.S.

"By encouraging consumer support for a promising new technology, our government is supporting innovation and investing in our nation's future," Press told the Electric Drive Transportation Association. "We'd like to see those tax incentives continue."

Federal tax credits for Toyota and Lexus hybrid vehicles were cut in half beginning in October. The $3,150 credit for the popular Toyota Prius, the largest hybrid tax credit available, shrank to $1,575 on Oct 1.

Credits for other hybrids made by Toyota, including certain Camry, Highlander and Lexus vehicles, were reduced to between $775 to $1,300.

Press said there was a drop in demand for hybrids after the full tax credit expired for Toyota and "it shows that it had an effect."

President Bush has called for an extension of the tax credits for the purchase of hybrids and other alternatives, but Congress showed little interest in extending the incentives before this month's elections.

Toyota has been expanding its offering of hybrids along its vehicle line and Press told reporters that the automaker was looking into expanding the Prius line. He said the considerations were still at the conceptual stage and no decisions had been made.

Press urged stronger partnerships between government and the industry, noting that the development of alternative vehicles could be spurred through fleet buys for the military and government use. The shift in power in Congress offers a "moment of opportunity," he said.

"There's a two-year window of opportunity that we probably won't see again for a decade. It's time for the industry and government and all of the constituent organizations and suppliers to really come together and take a long-term strategy," Press said.

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