Honda Motor Co plans to launch a plug-in hybrid and battery electric model in 2012 as part of its strategy to push to the front of a race by global automakers to develop more fuel-efficient cars. Japan's No.2 automaker was one of the world's only car makers to offer gasoline-electric cars during the past decade but has begun looking like a laggard without a “strong” hybrid or concrete plans to mass-produce pure electric cars. Global competitors from Volkswagen AG to Hyundai Motor Co are preparing to launch strong hybrid models that are more fuel-efficient than Honda's “mild” hybrids such as the Insight, while also readying battery-run cars.

At a news conference, Chief Executive Takanobu Ito, outlining the firm's medium-term strategy, said Honda was planning to sell a plug-in hybrid vehicle and a battery-powered electric model in Japan and the United States in 2012. Japanese rival Toyota Motor Corp is planning to bring a plug-in hybrid to market in 2011 and recently formed an alliance with California start-up Tesla Motors to develop electric vehicles. “Considering Toyota is set to launch a plug-in hybrid next year, Honda's 2012 schedule sounds a bit far off. This underscores the gap in the level of technology at these automakers,” said Kazutaka Oshima, president of Rakuten Investment Management. “That said, while Toyota has the lead, there really isn't anyone else who is as advanced as Toyota in this field and Honda appears to be close.” Asked about the walk-outs over the past two months at affiliated suppliers in China, the world's biggest auto market, Ito acknowledged that poor communication may have been at fault. “It's possible that the dialogue between workers and our local management in China was lacking,” he said, vowing to do better to prevent further disruption.

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