Nissan is likely to develop a low-cost, compact powertrain similar to those in Honda hybrids, with an electric motor to provide additional power to a constantly working engine. The motor will run on high-performance lithium ion batteries. The hybrids are expected to be 50-60% more fuel efficient than their gasoline-powered counterparts.

Nissan’s Serena minivan is likely to be the first model to get the hybrid makeover. With about 33,500 sold domestically in the January-June half year, it was Nissan’s most popular offering.

Nissan is introducing an electric vehicle in Japan and the US at the end of 2010. Nissan froze its earlier development of hybrids in 2002, relying instead on an agreement with Toyota for the hybrid version of the Altima sedan available in the US.

Nissan has developed hybrid technology for large and luxury rear-wheel-drive vehicles (e.g., the Fuga luxury sedan due on market next fall, earlier post).

Hybrids accounted for about 9% of new-car sales in Japan last month.