Ford Motor Company, in a bid to lessen its dependency on the precious rare earths metals, has moved to come up with a new line of automobiles that run on new lithium-ion batteries instead of the nickel-metal-hydride batteries.

The replacement effectively slashes the company's use of expensive rare earth metals by up to 500,000 pounds or 226.8 tonnes a year.

"We're continually looking to find ways to provide greater fuel efficiency as well as cost savings to customers of our hybrid vehicles, and the reduction of rare earth metals is a key part of this strategy," Chuck Gray, chief engineer, Global Core Engineering, Hybrid and Electric Vehicles, said in a statement. "The third-generation hybrid technology we are now using builds on our 20 years of electric vehicle innovations."

The automaker explained the reduction of rare earth metals works for both financial and physical reasons.

Apart from reduced cost, 30 per cent compared to previous-generation hybrid batteries, lithium-ion batteries are 50 per cent lighter and 25 to 30 per cent smaller.

"The result is better fuel efficiency in Ford's new electric vehicle offerings, including a projected 47 mpg for Fusion Hybrid and an EPA-certified 47 mpg for C-MAX Hybrid," Mr Gray said.

Most common in nickel-metal-hydride batteries are rare earth metals neodymium, cerium, lanthanum and praseodymium. None of these are present in the new lithium-ion batteries.

Mr Gray announced Ford likewise cut by 50 per cent the use of dysprosium in magnets used in the hybrid system's electric machines. Dysprosium is the most expensive rare earth metal used in Ford vehicles.

The overall reduction of rare earth metals in the lithium-ion batteries and electric machines lowers vehicle costs, which is Ford's key as it targets triple production of its electric vehicles by 2013.

"The reduction of our use of rare earths will help us ultimately translate it to more affordable, fuel-efficient vehicle choices for customers," the US automaker said.