Hit by fuel prices motorists look to alternatives

By Gerard Wynn

LONDON (Reuters) - With oil prices near $140 a barrel, motorists are starting to look seriously at both alternative fuels and electric vehicles as a way to be able to keep driving their cars.

But experts say it will take five to 10 years for these alternatives to take root, given the capacity challenge for an auto industry that is adding 65 million new cars a year to a fleet of 1 billion.

In the meantime, car and parts makers, oil companies and even electricity generators are left guessing which way motorists will turn and what technology will win.

"We don't know at the moment whether it's battery-based electricity technology or sustainable biofuels that will be successful," said James Smith, chairman of Shell UK, speaking at a climate change seminar hosted by Reuters.

"The strategic issues confronting us are very significant."

A range of options will emerge as motorists pick between "plug-in" electric cars, longer-range gasoline-electric "hybrids," or simply downsized, more efficient gasoline and diesel models, and as governments, worried by global warming and energy security, give more or less support for biofuels.

Hybrid vehicles, which have both a conventional internal combustion engine and electric motor and battery, are already popular. Toyota Motor has sold 1.5 million Prius hybrids since 1997 and it wants hybrids to reach one tenth of its total sales by 2011.

In a hybrid, the electric battery and motor aid stop-start city driving, while the gasoline engine allows longer trips, together cutting energy use and carbon emissions.