Aug. 24 (Bloomberg) -- Honda Motor Co., the world's biggest motorcycle maker, said it is developing motorcycles that can run on gasoline-electric engines and fuel cells, extending the so-called hybrid technology for the first time to two-wheeled vehicles.

The company has built a scooter with a 50 cubic centimeter hybrid engine and a 125cc fuel cell-powered scooter, said Honda President Takeo Fukui, speaking to journalists at its research center in Tochigi Prefecture, north of Tokyo.

Honda, one of the world's two makers of vehicles with hybrid engines, is trying to use its technology to extend its edge over smaller motorcycle makers Suzuki Motor Corp. and Yamaha Motor Co. Toyota Motor Corp., the world's biggest producer of hybrid cars, doesn't make motorcycles.

``Honda is growing because it comes up with new ideas and technology and are able to apply those to their products and advance development,'' said Atsushi Osa, who helps manage the equivalent of $110 billion at Sumitomo Mitsui Asset Management Co. in Tokyo. He declined to say whether he owned Honda shares.

Automakers are trying to take the lead in developing cleaner technology as government around the world tighten emission regulations. Vehicles that are more fuel-efficient and which run on alternative fuels are also becoming increasingly popular as the price of oil surges to records.

Honda Motorcycles

Honda, Japan's third-largest automaker by vehicle sales, has developed a type of scooter powered by gasoline- electric engines with a volume of 50 cubic centimeters, the company said. The scooter, which doesn't yet have a model name, has the same size as its current Dio Z4 model. It emits 37 percent less carbon dioxide than Dio and is 1.6 times more fuel efficient, Honda said.

Honda didn't say how the hybrid motorcycle works. A car that runs on a hybrid engine, such as the Honda Accord or the Toyota Prius, combines a gasoline engine with a battery pack.

At low speeds, electricity powers the vehicle and the gasoline engine takes over as the car gains speed. The battery is recharged using the gasoline engine and the brakes. The Prius can travel up to 55 miles on a gallon of gasoline, more than double the mileage on a car with comparable size engine, according to the U.S. Environmental Protection Agency.

Honda has also developed a scooter that runs on a hydrogen fuel cell. The fuel-cell motorcycle has a 125cc engine, Honda said.

Honda's Income

Honda expects net income to fall as much as 10 percent this year as the yen has strengthened against the dollar since last year. Honda predicts sales will rise, helped by demand from China and Europe and the introduction of new models.

Fuel cells, used for decades in spacecraft, produce only steam or water as a byproduct of generating electricity. High costs and a lack of hydrogen fueling stations have limited the technology to small test programs to date.

Honda, the first automaker to develop humanoid robots, generates more than 80 percent of its sales from automobiles. The robot project, like Honda's aerospace projects and Formula One racing team, is part of the company's technology development program, executives have said.

Honda shares, which have risen 11.3 percent this year, rose 0.8 percent to 5,300 yen in Tokyo.

To contact the reporter on this story: Kae Inoue in Tokyo at kinoue@bloomberg.net.

Last Updated: August 23, 2004 23:21 EDT