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Reducing Carbon Dioxide (CO2) emissions is one of the major challenges for automobile manufacturers. This is driven by environmental, consumer, and regulatory demands in all major regions worldwide. For conventional vehicles, a host of technologies have been applied that improve the overall efficiency of the vehicle. This reduces CO2 contributions by directly reducing the amount of energy consumed to power a vehicle. The hybrid electric vehicle (HEV) continues this trend. However, there are limits to CO2 reduction due to improvements in efficiency alone. Other major improvements are realized when the CO2 content of the energy used to motivate vehicles is reduced. With the introduction of Extended Range Electric Vehicles (E-REVs) and Plug-in HEVs (PHEVs), electric grid energy displaces petroleum. This enables the potential for significant CO2 reductions as the CO2 per unit of electrical energy is reduced over time with the improving mix of energy sources for the electrical grid.

A key element of General Motors' Advanced Propulsion Technology Strategy is the electrification of the automobile. The objectives of this strategy are reduced fuel consumption, reduced emissions and increased energy security/diversification. The introduction of hybrid vehicles was one of the first steps as a result of this strategy. To determine future opportunities and direction, an extensive study was completed to better understand the ability of Plug-in Hybrid Electric Vehicles (PHEV) and Extended-Range Electric Vehicles (E-REV) to address societal challenges. The study evaluated real world representative driving datasets to understand actual vehicle usage. Vehicle simulations were conducted to evaluate the merits of PHEV and E-REV configurations. As derivatives of conventional full hybrids, PHEVs have the potential to deliver a significant reduction in petroleum usage.