At the Shanghai show, both SAIC and Chery displayed experimental fuel-cell sedans, while they and a third Chinese automaker, Chang'an Automobile Group Co., also showed gasoline-electric hybrids.

SAIC said it will start selling its hybrid next year, while Qin said Chery's would go on the market in two to three years.

"The hybrid will be our focus," SAIC chairman Hu Maoyan said at a news conference. "The fuel cell will be our direction."

SAIC has spent 100 million yuan ($12 million) on fuel cell research, according to state media.

Chery had the widest array of alternative vehicles on display at the Shanghai show. They included models outfitted to run on bio-diesel made from vegetable oil or a "flexible fuel" choice of compressed natural gas or ethanol.

Foreign automakers also are playing a role in China's research.

General Motors Corp. has a joint-venture technology center with SAIC in Shanghai and operates three experimental fuel cell buses in the city. DaimlerChrysler AG has three of its own fuel cell buses running regular routes in Beijing in a research project with the technology ministry.

Foreign automakers including GM, Ford Motor Co., BMW AG and Honda Motor Co. displayed their own hybrids and experimental fuel cell cars at the Shanghai show.

Company officials said hydrogen fuel cells, which produce power with no exhaust, are the cleanest option. But they say it could be a decade or more before such technology is commercially feasible, due partly to the need to create a network of hydrogen filling stations.

Chinese authorities also are looking at other possible fuels such as natural gas and methane extracted from coal, said Mei-Wei Cheng, the president of Ford's China operations.

"This is not an easy decision, because every option has pros and cons," Cheng said. "The government is trying to find a solution as quickly as possible, but this is a difficult problem."