VW, Chinese Partner to Make Hybrid Cars

Volkswagen will start making hybrid cars by 2008 with its main Chinese partner and may kick off large-scale production of the energy-efficient vehicles by 2010, the Chinese company said.

Europe's biggest automaker is teaming with Shanghai Automotive in a project that could spur China's hunt for alternative energy sources and curb pollution as demand for cars soars in the world's No. 7 economy.

Their venture intends to make 500 hybrid Touran cars to be used as people carriers during the 2008 Beijing Olympics, Shanghai Automotive, China's largest car manufacturer, said.