General Motors has announced that it will continue its development of hybrid vehicles even though at this point the company will lose money on the project. The company said that it will pursue hybrid technology in order to boost its credentials as an environmentally-conscious firm.

The chairman and chief executive of GM said that the hybrid technology is still in its early stages and sales volume is still low. He also said that he believes that it will be very difficult to persuade buyers to pay the extra money for a hybrid vehicle unless gasoline reaches a price of around $8 per gallon.

Analysts are concerned that if GM continues to pursue hybrid technology it will harm its sales of a new group of large Subs and pick-ups to be launched next year. Still, GM is planning on introducing hybrid versions of its GMC Yukon and Chevrolet Tahoe in late 2007, and to follow those by the launch of hybrid pick-ups.

They developed the hybrid technology they will use in conjunction with Daimler Chrysler and BMW. In addition to the implementation of hybrid technology, GM also plans on brushing up its environmental credentials by improving fuel efficiency by 10 percent on its non-hybrid vehicles.