Is Mazda close to a new and sensational deal with Toyota over hybrids?

A deal that would see Mazda adapt Prius technology to create a new range of eco-busting Mazda hybrids, to hit the market within four years?

That, according to the current vibe in Japan, is what’s under discussion right now and an announcement, say informed sources, is expected "soon."

Desperate to get into hybrids, Mazda secretly approached Toyota over the supply of key hybrids bits (motor, battery, control units), so the story goes, with a target of selling 100,000 new Mazda hybrids per year by 2013. .

Mazda’s already had some limited hybrid action with Ford and in Hiroshima continues to work away on a hybrid system of its own, all that’s true.

But this Toyota tie-up would be a totally different ball game: much bigger scale and faster to market and on the face of it, so yes, the logic does seem to stack up.

One, Mazda wants a fast "in" to hybrids to boost its eco standing. Two, hybrid tech still costs an arm and a leg so by supplying Mazda too, Toyota can achieve vast economies of scale and bring in some welcome (and needed) extra cash. Third, such a deal would also help Toyota on its way to setting the de facto hybrid world standard.

There are just a couple of problems. Both Toyota and Mazda have publicly denied it. "TMC does not have a plan to supply Mazda with hybrid systems," Toyota said in a statement. Mazda duly dismissed it all as "speculation by journalists."

Read 'Prius boosts Japan's hybrid sales'

Even so, there knowledgeable people around who believe it’s actually not far off the mark.

One question mark actually concerns supply. The new Prius is red hot right now and with ever more hybrids piling on the scene, there’s the question of whether Toyota can actually supply enough hybrid bits to supply itself, let along take Mazda on board as well.

As for the Prius, it’s being seen as a real game changer in Japan. It’s topped the sales charts from day one and catapulted hybrids right to the centre of the market, elbowing the Honda Insight aside in the process. It’s captured the public’s imagination like none other and of course, the technology is only going to get better…

That’s why Mazda’s so keen to get in on the action, or so it’s believed. Prius tech in a stylish Mazda body and with decent handling, that could actually turn out to be quite a compelling combination, don’t you think?

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