By Warren Brown
Sunday, May 18, 2008

Largely thanks to government mandates and rising fuel prices, the green revolution is revving up in the global automobile industry.

Even Nissan, which once frowned on all things electric and hybrid, is planning to launch several fleets of electric vehicles aimed at markets such as New York and London and at commercial delivery enterprises worldwide.

General Motors, Ford and Chrysler also are moving toward vehicle fleet mixes that will include many hybrid and electric cars and trucks, as well as vehicles equipped with advanced gasoline and diesel engines.

Although few automobile executives will say so publicly, most of them, especially in the United States, are praying that gasoline prices remain high to help protect their multibillion-dollar investments in new vehicle propulsion technologies. That is because government-mandated investments to improve automobile fuel efficiency and emissions controls in the United States historically have been accompanied by ineffective government action to get consumers to buy the results.

By comparison, in Europe and Asia, government demands for tougher controls on carbon dioxide emissions and for vehicles that have better fuel efficiency often have been wedded to levies designed to affect consumer behavior, including higher taxes on gasoline and horsepower.

"But we aren't going to do that here," said Greg Martin, Washington spokesman for GM.

"Would GM want Congress to do that, raise federal fuel taxes?" I asked.

"We have no position on the gas tax question," Martin said, giving an answer often repeated by domestic automobile executives.

But many of them secretly are applauding the rise in gasoline prices, although, ironically, fuel inflation now is costing their companies hundreds of millions of dollars in lost sales of gas-thirsty pickup trucks and sport-utility vehicles.

Car companies see the demise in popularity of those vehicles as a short-term problem, perhaps even one that was inevitable. Interviews with executives at Chrysler, Ford, GM and Mazda reveal as much. For example, G. Richard Wagoner Jr., in public and private comments, frequently has predicted that challenges to the continued availability of oil and the rising price of fuel would change consumer vehicle demand and the kinds of cars and trucks produced by the automobile industry.

That does not mean big cars and trucks will disappear, Wagoner said. "But they will become more efficient," he said. "We will have more electrics."

Carlos Ghosn, chairman of the Nissan/Renault enterprise, this month told reporters in Cascais, Portugal, that he changed his position on hybrids and electrics because the mind-set of the global automotive market has changed.

"It's a territory we want to own," Ghosn said of the potential market for plug-in and other electrics. "We are bullish on zero-emission vehicles because of the social trend. The young generation is demanding this. The social trend will make electric vehicles more favorable."

High fuel prices and government incentives to consumers, either through tax breaks or lower vehicle registration fees, will also help the sale of zero-emission cars and other electric vehicles, Ghosn said.

Electric vehicle sales will grow considerably beyond the barely 1 percent market share, including fossil-fuel electric hybrids, they hold in the United States.

But they are only one route to a more fuel-efficient future, said Uwe Grebe, GM's executive director of global advanced engineering.

"There is no single silver bullet," Grebe said, speaking to reporters in GM's Washington office. "We are going to have a variety of technologies available at the same time. Each will have the goal of reducing our dependence on oil."

Those technologies include applying the compression-ignition efficiency of diesel engineering to gasoline engines -- up to a point. Grebe and his colleagues showed off a concept Saturn Aura that uses the "homogenous charge compression ignition" (HCCI) technology to get 15 percent better fuel efficiency over traditional gasoline engines.

The car operates in HCCI mode up to 55 mph, which means it will operate in compression-ignition mode during most city travel. At 55 mph, it switches to spark ignition, getting the best use of traditional internal combustion engine technology, which operates more efficiently at higher speeds. All of this is accomplished through the magic of computers and electronic sensors, which are increasingly important to almost any technology designed for better fuel economy and lower emissions.

There is a race to get many of these technologies to market as early as 2010, most certainly by 2015. It is the hidden blessing behind the fuel inflation curse. The company that gets there first with the most reliable, useful and attractive products will own the future of the worldwide car business.