Author: reuters

By Joseph White

DETROIT (Reuters) – The next generation of the Toyota Camry, the best-selling sedan in the U.S. market, will come with only a gas-electric hybrid powertrain, the boldest move yet by the Japanese automaker to push hybrid technology into the heart of the U.S. market.

The 2025 Camry will combine a 2.5-liter gasoline engine with an electric drive system tuned to deliver more power in both front-wheel drive and all-wheel drive versions of the car, Toyota said.

Compliance with tougher U.S. fuel economy rules was a factor in Toyota’s decision to make the new Camry an all-hybrid vehicle line, dropping four- and six-cylinder combustion models that made up about 85% of sales in the current model year, David Christ, head of the Toyota brand in North America, told Reuters. Another factor behind the decision was “the performance we were able to get out of the hybrid,” he said.

While Toyota has accelerated development of electric-vehicle technology, it is still betting that demand for hybrids and plug-in hybrids will remain robust as the automaker takes a “multi-pathway” approach seeking to satisfy customer needs in every market.

The hybrid powertrain and a new electronic all-wheel drive system deliver 232 combined horsepower – nearly 15% more than the outgoing Camry with a mechanical all-wheel drive system, Toyota said.

Toyota executives unveiled the ninth generation of the midsized Camry sedan on Tuesday in Los Angeles, ahead of the Los Angeles Auto Show that opens on Friday.

The new Camry will compete in a segment largely abandoned by the Detroit brands, with the exception of General Motors’ Chevrolet Malibu. The new Camry’s direct competitors – putting aside scores of compact and midsized SUVs – will include a few remaining sedans such as the Honda Accord, the Hyundai Sonata and Tesla’s all-electric Model 3.

The Tesla Model 3 outsold the Camry in California, a key market for Toyota, during the first nine months of 2023, according to data from the California New Car Dealers Association.

Toyota did not disclose pricing or fuel-efficiency figures for the 2025 Camry, due in showrooms next spring. The cheapest Camry hybrid model currently sells for about $2,400 more than the most inexpensive combustion Camry.

Most of the hybrid powertrains sell at a $1,500 to $2,000 premium to combustion models, Christ said. “We think the value the hybrid powertrain brings is worth that kind of premium.”

A current Camry hybrid is rated at 52 miles (84 km) per gallon in combined city and highway driving, compared with a 32-mpg rating for the conventional four-cylinder Camry. The hybrid saves $650 a year in fuel costs compared with the combustion model, according to U.S. government fuel economy data.

Toyota previously switched its Sienna minivan to an all-hybrid powertrain approach. The Sienna is “our second-fastest turning car and the car we have the most reservations for,” Christ said.

(Reporting by Joe White in Detroit; Editing by Matthew Lewis)`

(This Nov. 9 story has been corrected to say Avery Klemmer is an investor, not a partner, in paragraph 7)

By Krystal Hu

(Reuters) – OpenAI’s announcement on artificial intelligence “apps” do not spell the death knell for nascent startups building AI products, two OpenAI investors said at a Reuters NEXT conference on Thursday.

Investors are still hunting for new AI products that could help consumers interact better with the technology and address deep tech issues such as brain computer interface, they said.

The owner of the wildly popular ChatGPT chatbot earlier this week unveiled a marketplace that allows users to access personalized AI “apps” for tasks like teaching math or designing stickers.

The news sparked fear among AI startup founders who worry they will not be able to compete with OpenAI, which is trying to build an AI empire with products aimed at both consumers and enterprises.

“There’s so much room for continued innovation in AI. We’re in an intermediary step in a decades-long revolution,” Konstantine Buhler, partner at Sequoia Capital, told the conference. “You can play a very big role in how this is shaped.”

Sequoia invested in OpenAI in 2021, the maker of ChatGPT, in which Microsoft also has a larger stake.

Avery Klemmer, investor at Thrive Capital, which recently increased its investment in OpenAI, also said she sees opportunities for the rise of consumer applications beside ChatGPT.

She expects more innovations based on the existing format of AI chatbots popularized by ChatGPT.

“I think there will be really novel formats and forms of engagement that get invented,” Klemmer said.

Despite recent frenzied investments into the technology by companies and venture capital firms, analysts and investors say development of AI products is still in the early stages.

While it’s still relatively expensive to build applications using large language models, the accelerated pace of research in the space could result in a rapid decline in the cost of AI inference, or using an AI model to make predictions, and inspire new products, Jill Chase, partner at CapitalG, told Reuters NEXT.

“The cost of inference coming down so dramatically may seem like a small thing, but it’s hugely impactful for what types of businesses can be created and what use cases incumbents can empower,” she said.

(Reporting by Krystal Hu in New York; Editing by Sayantani Ghosh and Deepa Babington)