PSA Peugeot Citroen plans to enter the hybrid market in Europe in coming years with new diesel hybrid technology, but the current economic downturn is starting to take its toll on the French carmaker and could see further development of the efficient powertrains delayed. The technology has already been previewed in a number of concept cars, including the recently revealed Prologue HYmotion4 AWD and a diesel hybrid Le Mans racer, but according to one PSA exec the first production versions are unlikely to be available until 2011 at the earliest.

Speaking with Automotive News, the manager of PSA's hybrid innovations unit, Ladimir Prince, has revealed that the carmaker's plug-in hybrid project "could be delayed by a year or two." He also confirmed that the first diesel-hybrid powertrain will appear in the Peugeot 3008 crossover.

The key factor affecting the project is the high-development cost of the lithium-ion batteries required to power the vehicles. Prince explained that the business case is hard to justify given that the diesel hybrid models are only expected to sell in the few thousands.

Despite the hurdles, PSA engineers are soldiering on. In December the carmaker signed a deal with Bosch to supply it with diesel hybrid components, including the electric motors and electronic systems for AWD versions, as well as ABS and ESP systems.

The first model, based on the 3008, is expected to feature an AWD system and achieve a fuel-economy rating around the 68mpg (3.45L/100km) mark. Inventively, PSA’s design eliminates the associated heavy weight of AWD vehicles by using two powerplants in the car. By putting the diesel drivetrain up front, where it can drive the front wheels, and the electric motor at the rear, where it drives the rear wheels, PSA has eliminated the need for heavy and bulky transfer cases, driveshafts and differentials.