DETROIT, JAN. 8 -- The little Dodge Neon car on display at the North American International Auto Show here has wheels made of recycled aluminum, door panels made of recyclable plastic and body paint that contains none of the solvents that make painting cars a chemically hazardous business. Its little two-stroke engine can deliver in excess of 40 miles per gallon while still providing enough power to move a family through highway traffic in safety and comfort.

No one is talking 0 to 100 mph in under 6 seconds or marveling at the concept car's sleek styling, which seems more akin to a VW bug than anything else. But like many other "idea cars" on display at the show this year, the Neon makes an important statement about the industry's retreat from glitz and move toward practicality.

Congressional demands for cleaner air, rising public concern about auto safety and environmental matters, and more somber economic times are changing the automakers' views of cars of the future, according to auto executives attending the show.

In the labs and design rooms of the industry's top engineers, time and attention is increasingly being spent on improving product safety, experimenting with cleaner burning fuels and searching out ways of building cars with recycled parts.

"The major challenges for our industry during the decade of the 1990s will be energy and the environment, with a continued emphasis on safety," said Karl Gerlinger, president of BMW North America. "BMW thinks that every automaker should and can improve in the areas of fuel economy, safety and emissions."

Other automakers apparently agree. Almost every exhibitor in the sprawling Cobo Hall convention center here has exhibits proclaiming the environmental benefits of its wares.

The race to develop a marketable, clean-burning, two-stroke auto engine is indicative. Traditional engines have four strokes -- fuel-air intake, fuel-air compression, combustion and exhaust. Two-stroke engines combine intake and exhaust into one stroke, and compression and combustion into another.

Because two-stroke engines do half as much work as four-stroke models, two-stroke engines use substantially less fuel. And because two-stroke engines require fewer components than four-stroke models, two-stroke engines are easier to produce.

The sticking points are that two-stroke engines tend to pollute the air more than four-stroke models, and that they tend to run rougher and are considered less durable than four-stroke engines. But America's three largest car companies, along with Japanese challengers Toyota Motor Corp. and Honda Motor Co., are fast at work trying to overcome those hurdles in hopes of someday making the two-stroke a viable answer to their fuel-efficiency goals.

In essence, the industry is responding to a change in consumer values, said J. Davis Illingworth, group vice president of Toyota's luxury Lexus car division.

"As 1991 begins, the industry is seeing a sharp change in consumer buying patterns," Illingworth said. People who want luxury also want a car that is safe and fuel-efficient, he said. "Increasing numbers of consumers are concerned with value. Decreasing numbers are concerned with status symbols."

That change in attitudes has prompted Mercedes-Benz to develop the F100, an experimental vehicle that resembles a family station wagon.

The swoop-bodied F100 is "a rolling test bed" of new safety, environmental protection and engine technologies that Mercedes-Benz could use in future automobiles, said company engineer Harald Leschke.

"Right now, it's impossible to convert this vehicle into a production car because it has so many new technologies that have not been proven" in real-world use or manufacturing, Leschke said.

For example, the operational F100 can be converted to operate with electric power, methanol, hydrogen or a combination of the three. Solar power also can be used to support continuous ventilation of an F100 vehicle parked in the summer sun. Other F100 innovations include recyclable plastics and an electronic communications system to help the vehicle's driver avoid traffic jams.

"Things are changing," said Tony Cervone, a Chrysler Corp. spokesman. "We're not building concept cars just to get an 'Oh, wow' anymore," Cervone said. Designing cars solely for glitz, he said, "is throwing money away."

And with the auto industry having ended 1990 with a 6.8 percent decline in sales -- its worst performance in seven years -- they don't have money to waste.