With two sources of power working together a combustion engine and an electric motor powered by a battery Hybrid Electric Vehicles (HEV) have excellent energy efficiency, and are perfect for modern motorists in a resource-scare world.

Proudly standing next to his company's prototype EQ7200, Fu Jun, deputy general manager of Wuhan-based Dongfeng Electric Vehicle Co Ltd, said he believes this is the future.

Along with a hybrid electric bus the EQ6100 the car was on display at the Exhibition of Science and Technology Achievements during the 10th Five-Year Plan (2001-05), which concluded yesterday in Beijing.

"We are optimistic because we are convinced that HEVs, with much higher energy efficiency and less emissions, personify an inevitable trend in the auto industry," said Fu.

The EQ7200 can reach a top speed of more than 160 kilometres per hour while consuming 30 per cent less petrol than a normal car of the same size.

Six EQ6100 buses have been on trial operation on a passenger route in Wuhan, capital of Central China's Hubei Province, for two years.

Fu said his company is going to prepare buses for full commercial use by the end of this year. The first clients are likely to be city public transport authorities and government departments.

Dongfeng Motor Corporation, the parent company of Dongfeng Electric, won a competition in 2001 run by the 863 Programme the nation's high-tech research and development project to take on the challenge of developing China's first generation of hybrid vehicles.

Fu said his company holds the patents for the two HEVs, with some of the spare parts co-developed with foreign enterprises.

Despite his confidence in the potential of the two HEVs, Fu is only "cautiously optimistic."

Protecting the environment comes at a price an HEV is usually about 30 per cent more expensive than a conventional equivalent. Also, it is unclear to what extent the government will support the industry with favourable policies.

China's expertise in making spare parts for HEVs is relatively underdeveloped.

"In spite of this, we are firmly committed to the undertaking because we believe an excellent enterprise must have vision and take corporate social responsibility," Fu said.

"Now Japan's Toyota and Honda have taken the lead in making hybrid cars, which is an impetus for us."

Fu believes HEVs with combustion engines have the greatest potential for industrialization in the near future as they would not require much of an overhaul of the infrastructure of the traditional auto industry.

Xu Xingyi, president of Shanghai Powermax Technology Inc, which specializes in producing electric motors for hybrid and electric vehicles, forecast a series of obstacles for China's pioneers to overcome.

"The biggest bottleneck might be the overall backwardness of China's automobile industry," Xu said.

China lags behind in some of the key technological fields that produce materials for vehicles, according to Xu.

For instance, China has not mastered the power electronic module, an essential part of electric motors in hybrid vehicles. Also, domestic-made silicon sheet steel is generally inferior to that made by foreign companies.

"But as long as we have determination, we can make it and make rapid progress," Xu said.

"We must develop our own technology through innovation instead of depending on foreign suppliers, and fortunately, our nation has realized this in recent years."

As an entrepreneur, Xu has experienced the nation's growing fascination with innovation first hand.

Xu said that at the beginning of the Electric Vehicles Project under the 863 Programme, many domestic automakers chose to buy foreign parts when domestic products failed to reach the required standard, leaving no room for the home enterprises to develop.

But in recent years, Xu's company has received more and more orders from Chinese firms or been invited to join projects to develop specific parts.

Xu suggests the government be more patient and invest more in the basic sectors of the industrial chain, such as parts and materials, as well as focusing on the production of complete vehicles.

"We are very happy with the new atmosphere of innovation encouraged by our country," Xu declared.

The Exhibition of Science and Technology Achievements, which showcased some of China's latest scientific breakthroughs, demonstrated the nation's drive for innovation and resolution to try to realize an energy-efficient society.

"The traditional auto industry, which has been powered by fossil energy for more than 100 years, is certain to be replaced by a brand- new one powered by clean and renewable energy," said Xu Jing, deputy director of the Department of High-tech Development & Industrialization of the Ministry of Science and Technology.

Xu believes the shift is both necessary and urgent. Even though China is still at the threshold of becoming an auto society, with consumption of oil for automobiles accounting for less than one third of the total, the country has become aware of the great pressure exerted by the increasingly tightening global oil supply.

"The worldwide shortage of oil and worsening pollution have left us with little time and the next two decades will be a strategic period for China to shift the energy supply structure in the transport sector."

Per Carstedt, chairman of the Swedish-based BioAlcohol Fuel Foundation, pointed out that China has been presented with a golden opportunity to become the world leader of the auto industry of the future thanks, paradoxically, to its present backwardness in traditional auto manufacturing.

"As you are just at the beginning, it is easier for you to bypass the old auto industry and go right to the new technology," Carstedt said.

"In contrast, the traditional automakers, like the United States or Europe, have been deeply stuck in the old structure and will have to pay much higher costs to make the shift."

Xu hopes an energy-efficient car project will be included in the National Medium & Long-term Science and Technology Development Plan (2006-20).

"We need a clearer national roadmap in the field," Xu said.

Most developed countries have such plans in place and have pumped enormous amounts of money into the development of energy-efficient vehicles.

The United States has a "Freedom Car" programme to develop fuel cell vehicles and Japan is regarded as the world's best HEV maker.

"Our goal is to gradually reduce dependence on oil and pursue a diversified energy supply," Xu said.

"That is why we also develop fuel cell-powered vehicles, which may be the ultimate replacement for today's combustion engine vehicles."

A domestic-made fuel cell-powered vehicle, the Exceed III, developed by the Shanghai Automotive Industry Corporation and Tongji University, was also unveiled at the Exhibition of Science and Technology Achievements.

Its top speed is 110 kilometres per hour and it has a range of 219 kilometres before needing to be refuelled.

By feeding hydrogen into a fuel cell stack where it is combined with oxygen from the air, the car generates electricity from the chemical reaction between the two elements.

The car is totally clean as the process does not burn anything and water is the only emission.

During the 10th Five-Year Plan (2001-05), the nation has invested more than 1 billion yuan (US$123 million) in the research and promotion of energy-efficient cars.

The hybrid vehicles project started in 2001 and the Clean Car Campaign, focusing on alternative fuel vehicles, including compressed natural gas, liquid petroleum gas, methanol, ethanol and biodiesel started in 1999.

Statistics show China has 215,000 vehicles powered by compressed natural gas and liquid petroleum gas on the road and 712 filling stations, replacing 1.3 million tons of petrol every year.