Dec 01, 2006 -- Voice of America News/ContentWorks

Sustainability is the theme at this year's Los Angeles Auto Show, where carmakers are unveiling plans for more fuel-efficient models. Mike O'Sullivan reports, auto executives, including General Motors chief Rick Wagoner, say alternative energy will be the key to their future business strategy.

Wagoner says 35 percent of the world's energy needs are met by petroleum. With worldwide energy use growing at two percent a year, he says in coming decades, demand will outstrip the world's oil supplies. He adds that his industry faces other challenges, from conflict in the Middle East to climate change.

"For the global auto industry, this means that we must as a business necessity develop alternative sources of propulsion based on alternative sources of energy in order to meet the world's growing demand for our products," he said.

He says that in the future, some cars will be powered by hydrogen fuel cells, others by synthetic fuels or bio-fuels like ethanol. At the heart of the systems will be an electric battery.

General Motors now manufactures hybrid vehicles powered by both electricity and gasoline. In Los Angeles, Wagoner announced plans for a hybrid plug-in car, which will be part of its Saturn Vue sport utility line. The future model will recharge its battery through an electrical outlet and run on electricity for short drives around city. It will use gasoline for longer highway drives.

He notes the high-performance battery required for the car has not yet been developed.

"The technological hurdles are real, but we believe they're surmountable," he added. "I can't give you a date certain at this point for our plug-in hybrid, but I can tell you that this is a top-priority program for General Motors, given the huge potential it offers for fuel economy improvement."

Other carmakers are displaying fuel-efficient vehicles at the annual auto show, or talking about their plans for future models.

Toyota is showcasing its popular Prius hybrid, introduced worldwide in 2000, and its sports utility hybrids. Ford and other automakers also offer hybrids, and for the first time, Nissan will offer one in its Altima line.

Chris Martin of Honda says the Japanese automaker offers fuel efficiency across its product line, and manufactures a fuel-efficient hybrid. In two US states, California and New York, Honda offers consumers a car that runs on another technology designed to reduce emissions.

"We have a Civic GX, which is a natural gas vehicle, which runs on natural gas, which is available for home refueling," he said.

He says natural gas is environmentally friendly and saves on fuel costs. Natural gas can be 60 percent cheaper than gasoline.

Environmental activist Matt Leonard of the Rainforest Action Network is critical of the industry for not shifting its focus to alternative fuels more quickly. The group's primary target is Ford, but he also skeptical of General Motors' plans.

"Auto manufacturers continually make a lot of promises and statements regarding concerns for energy and environmental issues," he said. "And we applaud the fact that they are discussing these issues. Our concern is, we want to make sure that translates into reality, that manufacturers do actually take solid, concrete steps to bring to market mass produced vehicles that are high in fuel efficiency, that work toward zero emission vehicles."

General Motors chief Wagoner says gasoline-powered engines will remain the industry standard for years to come, but he says carmakers must diversify and turn to alternative fuel sources. He says the shift from petroleum will help the environment, open up new markets and could improve the industry's profits.

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