Microsoft hopes to SYNC up with the auto industry. The software giant's high-tech infotainment system has been one of the few big success stories for Ford Motor Co. this past year, drawing in the sort of high-tech-savvy buyers who might normally steer over to an import brand.

Now with Ford about to lose its brief exclusive on the SYNC system, Microsoft is ready to make a major push into the auto industry, the Detroit News reports. The Washington-based software company "will announce a massive new investment in its automotive business unit," the paper reports. And it has tapped Detroit native and Microsoft veteran Tom Phillips to head the operation.

"We know that things are tough for the auto industry, but it's the perfect time to make this investment," said Phillips. "There are new customers coming into the market and they are looking for new experiences."

There's been a general trend toward increasing the level of electronics in the average car. High-line manufacturers, such as BMW, with its complex iDrive system, can have more than $10,000 in silicon-controlled systems, ranging from engine, chassis, and safety controls to navigation and in-car entertainment. Even low-end vehicles are being offered with high-tech hardware.

Part of the challenge is to come up with technology that not only offers a wide array of features, but that is also easy to use. BMW has been repeatedly faulted for the complexity of iDrive, and plans a complete remake of the system shortly. Microsoft, however, has won kudos for SYNC, which offers the driver a variety of ways to issue a command, including one of the best voice control systems on the market. Ford recently launched a second-generation SYNC system that adds such features as traffic and weather, along with the ability to track restaurants, movie schedules, and gas prices.

Using SYNC as a come-on in its entry-level sedan, Ford has reportedly driven up the average transaction price on its Focus by $1,000 over the past year. As it expands availability, he automaker expects to sell about 1 million vehicles equipped with SYNC by the end of 2009.

But as with much of the technology provided by outside suppliers, manufacturers like Ford are generally granted limited exclusivity. And Microsoft is already beginning to license the SYNC system to other manufacturers, including the Korean upstart Hyundai, which expects to bring its own version to market within the next several years.

Toyota's Prius hybrid is already a hit with environmentally minded consumers, a fact that has driven the gasoline-electric sedan to the top of the green machine sales charts. But now, the Japanese maker hopes to expand the appeal of Prius by making it even greener.

The Japanese business publication Nikkei reports that some versions of the hybrid will be equipped with solar panels capable of generating as much as 5 kilowatts of electricity, starting next year. That would be enough, according to the paper, to power the hybrid's air conditioning system. That's a significant step, as A/C is a major power drain, particularly if the Prius is operating in battery power, rather than using its internal combustion engine.

The Prius is just the most visible of Toyota's expanding lineup of hybrids, with the automaker promising to offer gas-electric powertrains on virtually all of its product lines by late next decade. It is also developing a so-called plug-in hybrid version of the Prius, which would be able to charge a larger pack of lithium-ion batteries by plugging into the household power grid.

While the sun-powered A/C system - which reportedly will debut next May - is the largest automotive application of solar power, it's not the only one. Several makers, including Mazda, have used solar cells in the past to run vent fans designed to keep a vehicle relatively cool while parked.

Nissan will take a critical step in bringing next-generation lithium-ion batteries closer to mass production, a move meant to support the automaker’s goal of putting electric vehicles into production by the end of the decade.

As TheCarConnection.com first reported, late last month, Nissan has launched a series of test programs aimed at measuring the potential for advanced electric vehicles. With the strong support of CEO Carlos Ghosn, the automaker intends to start marketing an all-new EV to U.S. fleet buyers starting in 2010, with retail sales set to begin in 2012.

To get there requires new, high-powered versions of the lithium-ion batteries now used in consumer electronics, such as cell phones and laptop computers. Manufacturers will have to improve power levels, improve reliability – and lower cost. Nissan believes it has the formula. The automaker plans to invest 12 billion yen -- $115 million – over the next three years in its joint venture with Japan’s electronics giant, NEC Corp. The partners hope to ramp up production of advanced lithium batteries to as much as 65,000 packs annually by 2011. Most of that production would be earmarked for automotive applications.

Written off as dead just a few years ago, electric vehicles seem poised for a comeback, but while some manufacturers are exploring the potential of products battery by batteries alone, the industry remains primarily focused on hybrids, whether using gasoline, diesel, or some newer, alternative fuels, such as ethanol and hydrogen.

But spurred on by Ghosn, Nissan is betting that newer batteries will overcome past obstacles, including high cost and limited range, and help make a reality out of products, such as the quirky little Pivo2, shown above.

When the South Korean carmaker Hyundai recently announced plans to introduce a Microsoft-based navigation and communications system into its cars, it underscored the dramatic transformation of today’s automobiles. While they may remain, at their most fundamental, mechanical devices, the modern car has become an electronic center, with digital technology controlling everything from the engine to the backseat entertainment system.

Indeed, the biggest area of growth is in information and entertainment technology, sometimes dubbed “infotainment” or, if you prefer, "telematics.” These days, many cars feature more high-tech features than your typical home or office, and the trend seems all but certain to continue.

That’s why a new study by ABI Research forecasts that just navigation devices and systems alone will generate sales of $62 billion by 2012. "Despite disappointing sales levels in the first quarter of 2008 and profit warnings issued by TomTom, Tele Atlas and SiRF, the navigation market still faces a bright future," Dominique Bonte, ABI Research principal analyst, told the trade publication, Telematics Update. "The current decrease in sales has to be seen as a logical reaction following the extraordinary sales growth during the fourth quarter of 2007, especially in the United States."

Good news for Hyundai, Toyota, BMW, and Ford (its new SYNC system, in a Lincoln Navigator, shown above)? Not necessarily. Millions of Americans are forgoing the built-in systems these manufacturers sell – often at prices running to $2,000 – in favor of portable navi units, some of which are available for less than $200. There are dedicated navigation systems, like TomTom's, and now even gaming devices and phones with built-in GPS hardware.

So what’s a carmaker to do? It could depend on two things, acknowledges Alan Hall, a spokesman for Ford Motor Co.: either drop prices or add significant functionality. (Or both, we’d add.) It’s a growing bit of conventional wisdom that factory-equipped navi systems will have to drop to perhaps $500 to $700 to keep consumers ticking off that box when they order a new car.

Ford’s SYNC is commanding around $1,900 in the 2009 Escape crossover, yet sales are booming. That’s because the Microsoft-programmed system features not just navigation, but a multifunction audio package, with a 10GB hard drive and an incredibly intuitive voice interface. Want to find the nearest burger joint while driving cross-country? Just say, “I’m hungry.”

But as analysts note, such technology isn’t the exclusive property of automakers like Ford, at least not for long. Traffic and even weather, as well as detailed points-of-interest lists and voice control, are all showing up on portable devices.

The pot of gold is huge. The question is, who will be able to claim it?

The Korean carmaker Hyundai Motor Co. has inked an expansive deal with Microsoft that will bring a new generation of in-car electronic “infotainment” technology to the cars, trucks, and crossovers sold under the Hyundai and Kia brands.

The voice-controlled technology will integrate a wide range of features, including in-car navigation, audio, Internet access, and other electronic systems. And unlike conventional in-car electronics, the technology will be primarily software, rather than hardware-based, meaning updates and additional services will be able to be programmed into vehicles once they are already on the road.

The Hyundai-Microsoft system will be an advanced version of technology already on the road in a number of Ford Motor Co. vehicles and known by the name SYNC.

Until recently, Hyundai had lagged behind many of its competitors in terms of in-car electronic systems, such as on-board navigation, but “Customers tell us they really want this technology,” noted Joel Ewanick, the South Korean automaker’s U.S. marketing chief. Hyundai had already begun adding navi and other technologies, but believes that the integrated system, with its voice control, will make it easier for consumers to use – and thus increase the “take rate,” the number of consumers willing to pay a premium for such technology.

"These new systems will redefine consumer experiences in the car," said Martin Thall, general manager of Microsoft's Automotive Business Unit, during a ceremony at Hyundai headquarters in Seoul.

The new technology will use the Microsoft Auto software platform and should make its debut on a product bound for the North American market in 2010.

Hyundai announced it will spend $165 million over the next five years to expand the availability of in-car technology in Hyundai- and Kia-branded vehicles.

Along with the new infotainment deal, Microsoft and Hyundai – along with the Institute for Information Technology Advancement – announced they will create a new automotive innovation center designed to promote opportunities for Korean software and device vendors in the global market.