GLOBAL sales of new cars may be falling but with some buyers shifting from conventional cars to hybrid cars, demand for Lexus luxury hybrid models is still relatively strong, according to Lexus chief engineer Yoshihiko Kanamori.

"The overall volume is decreasing, and demand for luxury cars is also decreasing," he said. "But because people are shifting from conventional cars to buying hybrid cars, hybrid car sales are still good."

He said the trend is similar for non-luxury cars, although for this segment, buyers have another alternative besides the hybrid - they can choose a car with a smaller engine displacement.

Mr Kanamori was in Singapore recently to launch the Lexus GS450h luxury sports sedan. The GS300 with a conventional 3.0-litre petrol engine is already a common sight in Singapore but the GS450h is a petrol-electric hybrid with a 3.5-litre V6 engine connected to two electric motors and driving the rear wheels.

The car's kinetic energy, recovered during braking or decelerating, is converted into electrical energy and stored in the battery. With this Lexus Hybrid Drive system, the petrol engine's maximum output of 292 hp is boosted to a combined 339 hp.

The GS450h's sporty edge is reflected in Lexus marketing. The Japanese carmaker touts it as having a 3.5-litre V6 engine that performs like a 4.5-litre V8 unit but with the fuel consumption and low emission of a 2.0-litre V6.

The combined cycle mileage is listed at 12.6 km per litre and has the lowest levels - for its class - of NOx (nitrogen oxide) and HC (hydrocarbon) emissions combined at 0.01 grams per km. Carbon dioxide emissions are 186 grams per km. The GS450h is the third hybrid model to be introduced here by authorised distributor Borneo Motors Singapore, after the RX400h sport-utility vehicle and LS600h L limousine.

But unlike the two earlier hybrid models which are four-wheel-drive, the GS450h is rear-wheel-drive - just like the conventional GS300.

Mr Kanamori said that Lexus did not opt for the all-wheel-drive layout so as not to increase the car's kerb weight and impact fuel consumption and environmental performance.

"Another reason is that we wanted to maintain the sporty feel of the GS, so we did not want to make it heavier," he explained. The GS450h was introduced in the US, Europe and Japan in early 2006. But while the US is Lexus' biggest market, the GS450h's "penetration rate is higher in Europe", said Mr Kanamori.

In Germany, for example, the proportion of the GS Hybrid to total GS sales is more than 50 per cent. In US, it is less than 10 per cent.

"Europeans like hybrid cars because they are more environmentally conscious and because of the imposition of tax on CO2 emissions," he said. "If two GS models have similar prices, they will choose the hybrid version."

In other markets, a more expensive GS460 with a V8 engine is offered and costs about the same as a GS450h. In Singapore, the GS450h starts from $188,000 (after a green vehicle rebate) while the GS300 starts from $173,000. Borneo Motors expects to sell more than 20 units of the GS450h per month. It has already received more than 70 orders since the company began collecting bookings in October.

This article was first published in The Business Times on Dec 3, 2008.