French automaker Peugeot will be showing the latest iteration of their diesel-hybrid demonstration vehicles at the upcoming Frankfurt Motor Show. Previously they had shown a 307 and also Citroen C4 with a diesel parallel hybrid powertrain. The new car is based on the recently-introduced 308 which is a C-Class-sized car similar to the Ford Focus or Chevy Cobalt.

The new 308 hybrid HDi has a 107hp 1.6L diesel along with a 21hp electric motor. On the EU combined cycle the 308 is rated at 69mpg (US) and only 90g/km of CO2. That puts it very close to the latest Smart ForTwo diesel which gets 72mpg / 88 g/km but in a much more practical five-seat package. Production is currently targeted for 2010. All the details are after the jump.

[Source: Puegeot]

The latest diesel-powered cars offered in Europe come close to - and in a lot of cases beat - hybrid-electric cars like Toyota's Prius in the mileage stakes, so imagine what would happen if you combined the best of both technologies. France's Peugeot hopes to do just that and by becoming the first carmaker to launch a diesel-electric hybrid by the end of the decade.

The recently launched midsize Peugeot 308 hatch will be the first vehicle fitted with the new powertrain, but it's likely other models will soon follow suit if it proves to be successful.

The Peugeot diesel hybrid should average better than 70mpg (58.3mpg US), which would mean its emissions levels would be lower than most other cars except for pure electric vehicles. By comparison, the Prius rates 65.7mpg (54.7mpg US). However, most motoring mags have found its real-world fuel economy ratings to be much lower.

The only factor holding back the release of the hybrid 308 is the high cost of the batteries and electric motor, but engineers are working hard to make the technology more affordable.

[Source: TimesOnline.co.uk]