http://www.bloomberg.com/apps/news?p...d=aF1x1VLjeAUw

Jan. 9 (Bloomberg) -- Mazda Motor Corp. said it will sell a gasoline-electric hybrid SUV version of the Tribute sport-utility vehicle built by partner Ford Motor Co. to meet growing demand for hybrid autos in the U.S.

Mazda plans to introduce the Tribute hybrid in the second quarter of this year, said Daniel Morris, senior managing executive officer in charge of marketing, sales and customer service, in an interview yesterday at the North American International Auto Show in Detroit.

Mazda, the fifth-largest Japanese automaker, will join its bigger rivals in the gasoline-electric market. Toyota Motor Corp. and Honda Motor Co. account for about 90 percent of U.S. hybrid sales. Nissan Motor Co. plans to introduce a hybrid version of its Altima next month.

``Offering hybrids is important to meet consumers' tastes in the U.S.,'' said Hitoshi Yamamoto, who manages the equivalent of $1 billion in Japanese equities as president of Commerz International Capital Management (Japan) Ltd. in Tokyo.

Ford will build the Tribute hybrid, to be based on its own Escape model, at a factory in Kansas City, Missouri, Morris said. Mazda is one-third owned by Ford.
Fuel Prices

Regular gasoline averaged $2.57 a gallon at the pump in the U.S. in 2006, 13 percent more than in 2005, according to weekly U.S. Energy Department surveys.

A hybrid vehicle combines a conventional gasoline engine with an electric motor. The motor powers the vehicle at low speeds and the gasoline engine kicks in as the car accelerates. The battery pack is charged by the gasoline engine and by power regenerated by the brakes.

U.S. hybrid sales rose 22.5 percent last year to 253,652 vehicles.

Mazda, based in western Japan's Hiroshima prefecture, also plans to introduce a seven-seat CX-9 SUV next month. It will cost between $29,000 and $33,000, Morris said. The company aims to sell 40,000 CX-9s annually.

The automaker's U.S. sales rose 4 percent to 268,786 vehicles in 2006, helped by demand for its five-seat CX-7 SUV.

``It's very steady managed growth in the U.S.,'' Morris said.

Shares of Mazda fell 0.3 percent and traded at 799 yen at 9:35 a.m. on the Tokyo Stock Exchange.

Mazda is considering developing rotary engines that use ethanol or other alternative fuels as part of efforts to offer less polluting vehicles, said Seita Kanai, senior managing executive officer, in an interview.

The company is also improving the fuel economy of its gasoline rotary engines, he said. The new technologies will be part of Mazda's long-term business strategy to be announced in March.

Mazda is the world's only mass producer of rotary engines, whose power is supplied by turning a triangle-shaped rotor instead of alternating pistons. The carmaker revived the engine with the RX-8 in 2003 after dropping the RX-7 sports car from its U.S. lineup in 1996.