This is big news due to present high market share for hybrid vehicle batteries of Panasonic EV Energy Co. who make the current Prius battery (and Japanese battery manufacturers in general who dominate this market). Mass manufacturing studies imply the potential completion of a production ready design of a complete Lion battery pack system which would be a major milestone. It has been reported that Toyota has controlling ownership (60%) of Panasonic EV Energy and that they are a key player in Toyota's development efforts regarding Lion battieries. Here is a link to an article/summary: http://www.greencarcongress.com/2007/12/panasonic-ev-en.html Here is a link to the speech by Katsuaki Watanabe, president, Toyota: http://www.toyota.co.jp/en/vision/message/conference/071225.html
That's a very good news. To me, that means they covered the safety, power, energy density, life (recharge cycle), temp control, price, etc... , and then now studying for a mass production. So the question is, will 09 Prius use Li-ion off the bat or offered as a plug-in upgrade?
Three more years, minimum. It actually took Panasonic more to perfect the NiMH battery pack's mass production. Look how long it took them to ramp up production once the Prius became popular. So if 2009 does feature a plug-in Prius it'll be NiMH which they've perfected and is probably good news for our older Prius as far as swapping out the battery. Hint: it'll be cheaper. Also this might lead to an add-on for the older Prius but I'm not holding my breath.