Alternative fuel vehicles (AFV) are being developed by the US automobile industry to meet the requirements in producing efficient but less-emission vehicles and compete with the AFVs manufactured by Japan. During the Tokyo Motor Show held in Oct 1997, Toyota Motors Corp unveiled the Prius hybrid electric/gasoline vehicle that will eventually be marketed worldwide. General Motors and Ford Motors plan to hasten efforts in manufacturing AFVs. Chrysler is introducing an electric-diesel hybrid model called Dodge Intrepid ESX2.

The U.S. auto industry has come to some kind of watershed, embarking on what appears to be a serious drive to market alternative fuel vehicles (AFVs). There has been some experimentation in AFVs – even some major investments – but in the past two months, something has happened in Detroit.

AFV announcements at the many auto trade shows over the past few months leave no doubt that U.S. automakers are ardently taking up the challenge to produce more efficient and reduced-emission vehicles.

Remember in the 1970s when the petroleum shortages came along and only Japanese auto manufacturers, which produce smaller, more-efficient cars, were ready to meet budding U.S. demand for smaller cars? U.S. manufacturers were still making gargantuan autos with extreme appetites for motor fuel, and it took some time to swing in the other direction.

U.S. automakers admit they became believers very rapidly then, although not before the Japanese and other makers of small cars captured a large share of the U.S. market.

Something like this happened again in Tokyo in October. Japanese automakers stunned other manufacturers by unveiling several very fuel-efficient, low-emission cars. Of particular significance was Toyota Motor Corp.’s Prius, a hybrid electric/gasoline vehicle already on the market in Japan and soon to be introduced in other markets, including the United States. It gets 70 mpg. It will sell for $17,000, but costs twice as much to make.

U.S. and European manufacturers were still showing high-performance, high-fuel-consumption autos in Tokyo.

John F. Smith Jr., GM’s chairman and CEO, said the Tokyo Motor Show had made a profound impression on him, leading him to the conclusion that his company needed to embark on a strong campaign to develop leading technologies in the new era.

Smith said, “No car company will be able to thrive in the 21st century if it relies solely on internal-combustion (IC) engines. He reported GM was accelerating efforts to bring new AFV vehicles to market.

William Ford Jr., chairman of the powerful finance committee on Ford Motors’ board, said that a significant competitive advantage was at stake for the company that reached the market first with an affordable AFV.

Thomas Gale, Chrysler’s executive vice president for product strategy, said his company will introduce a plastic-bodied, electric-diesel hybrid Dodge Intrepid ESX2 capable of 70 mpg and emission reductions of 50%. High-volume production of the vehicle could begin by 2003 or earlier.

Ford announced it would introduce sport-utility vehicles and minivans this fall that pollute no more than passenger cars. Ford officials said the vehicles should help allay criticism that sport-utility vehicles are gas guzzlers that ought to be controlled more vigorously.

Ford recently committed $420 million to a partnership with Daimler-Benz of Germany to produce a fuel-cell vehicle by 2004. This appears to be the most advanced fuel-cell program so far, in partnership with fuel-cell developer Ballard Power Systems of British Columbia. What fuel will be used in Ford-Daimler-Ballard fuel cells is still up in the air.

Ford has also introduced a prototype family sedan that is 40% lighter than traditional cars and gets 63 mpg. The vehicle, known as the P2000, uses a direct-injection engine that burns natural gas. Ford is also developing electric-hybrid and fuel-cell versions of the P2000. This is part of the joint industry-government program to produce an affordable family vehicle that gets 80 mpg by 2004.

Chrysler said it supports use of gasoline as a hydrogen source in fuel cells because of its widespread availability. GM and Ford lean to methanol, although they appear not to have yet addressed the complex issue of fuel availability – a major obstacle to other fuels.

General Motors announced plans to produce a low-emission, hybrid-electric vehicle by 2001 and a fuel-cell-powered car by 2004 or sooner. Getting up to 80 mpg, it would be fueled by either gasoline, diesel or methanol.

GM, which has sold fewer than 300 EV1 electric autos since they were introduced in California and Arizona a year ago, plans to introduce an advanced battery that will double the range of the vehicles to 160 miles.

Conventional motor fuels will be dominant in the market for a long time to come, but it would be rash for marketers not to take seriously and keep abreast of the AFV trend.