Chrysler LLC has launched production of the hybrid versions of its Chrysler Aspen and Dodge Durango SUVs, set to go on sale this fall.

Chrysler's Newark, Del., assembly plant started building the SUVs this week. The plant is Chrysler's first to build vehicles with its gasoline-electric Two Mode hybrid system.

The hybrid system called for new assembly processes to install a 300-volt battery and other components that Chrysler is using for the first time.

"The implementation of this new manufacturing process was done intelligently, with both quality and cost in mind," Joe Ozdowy, Newark's plant manager, said in a statement.

The Two Mode hybrid drivetrain features a 385-hp, 5.7-liter Hemi V-8 equipped with a cylinder cutoff system. The engine is combined with a four-speed automatic transmission that has two internal electric motors. The Two Mode was developed by a partnership involving General Motors, Daimler AG and BMW AG.

The Two Mode powertrain propels the vehicle on electric power at speeds up to about 25 mph. It also can provide an extra boost of passing power on the highway when needed.

Chrysler has estimated that the hybrid system improves overall fuel economy 25 percent, to about 20 mpg city.

The Durango hybrid is priced at $45,340 and the Aspen at $45,570; both prices include shipping. Chrysler says buyers are expected to get a $1,800 tax credit.

Chrysler's Durango and Aspen hybrids enter an SUV market that has been slammed by a consumer shift to smaller cars.

Durango sales were down 84.5 percent in July, to 384 units. In the first seven months of the year, sales are down 51.3 percent to 15,293.

The Aspen has fared better than the Durango, but it was a new model in 2007. Through July, sales are down 3.7 percent to 14,446 units.