CO2 reduction, energy security and emission reduction in urban areas are some of the issues surrounding the future of the automobile. One high profile solution for these issues is Plug-In Hybrid Vehicles (PHV). It combines the advantages of Electric Vehicles (EV), which can use electricity for vehicle propulsion and Hybrid Vehicles (HV), which has high environmental benefit potential combined with cruising range comparable to conventional vehicles. This paper describes a newly developed plug-in hybrid system and vehicle performance. The system adopts Li-batteries with high energy density and has an affordable EV range without greatly sacrificing cabin space. The vehicle achieved 1.7 times better fuel consumption with 30 miles driving range. Additionally, the vehicle has met the most stringent emissions regulations in the world.