Volkswagen AG and its Chinese partner plan to produce a hybrid gasoline-electric van in Shanghai with the first few hundred ready in 2008, according to the Chinese partner, Shanghai Automotive Industry Cooperation. The hybrid, called Touran, will use nickel metal hydride batteries to switch from gas to electricity at low speeds to boost fuel efficiency. The van will be developed both in China and in Wolfsburg, Germany, VW's headquarters. In recent years, China has increased efforts to develop vehicles that use less and cleaner energy. Last year, the SAIC teamed up with GM to develop a vehicle using three hydrogen fuel cell technology while DaimlerChrysler AG is testing buses using the same technology in Beijing. Toyota, meanwhile, plans to produce gasoline-electric hybrids in China.