Like many other industries, the car business is currently grappling with the need to be more green. The impetus for change is coming from the usual twin-pronged cattleprod of legislation and market forces.

In Europe, the regulatory pressure comes from the European Commission, which has proposed laws capping average fuel consumption at 130g/km for a manufacturer’s entire fleet by 2012. The rules have yet to be set in stone, but only the smallest and most efficient cars on sale today slink under the proposed limits.

Car buyers, meanwhile, are sending a less than clear signal to the makers. Rising petrol prices at the pumps create some incentive to choose a more fuel efficient model, and some buyers are reacting as a result, but most consumers and business customers remain focused on other attributes. Big is still better, and speed still sells.

"Cars are the product most associated with social status," observes Boris Jacob, chief designer in the Advanced Design group at General Motors Europe (GM Europe). "No other product has such resonance".

Most buyers of new cars still bundle up feelings of self-worth and social standing with their choice of transport, so designers like Jacob face a dilemma. On the one hand, there is merit in creating vehicles that trumpet their rejection of traditional symbolism. Jacob suggests that the Toyota Prius hybrid, with its unusual humpbacked profile, slab sides and small wheels, may have been intentionally designed to look odd - allowing owners to make a visual statement.

On the other hand, there is good reason not to follow this route. "If you can't get people into the showrooms, they won't buy," Jacob notes, explaining that cars sell best when they exhibit "conventional automotive aesthetic values " and that makers "can't force people to eat muesli and wear Birkenstock sandals ".

Jacob's attempt at resolving these contradictions was on show at the recent Frankfurt Motor Show, in the shape of the Opel Flextreme concept car.

This is what GM calls a range-extended electric car. The car is propelled entirely by an electric motor driving the front wheels, fed by a substantial battery pack running down the spine of the chassis. However, the car also has a conventional diesel engine in its nose.

Unlike current hybrid cars, such as the Prius, the Flextreme's internal-combustion engine cannot directly drive the wheels. Instead it drives a generator, which feeds electricity to the motor when the batteries run low. If a journey is short - below 55km in this case - the diesel engine will remain lifeless, and the batteries will be recharged from the mains while the car is parked. The same "E-Flex" architecture underpins the US Chevrolet Volt concept, which when it arrives in production form will likely use a petrol rather than diesel generator.

Jacob walks around the Flextreme pointing out his solutions to conflicting requirements. The wheels have aerodynamically efficient flat covers, for example, but the covers are transparent - affording a view of the chunky alloy wheels within. The wheels are large, giving a purposeful and aggressive look from the side, but tyres are narrow, for lower rolling resistance and drag. Similarly, the familiar grille at the front of the bonnet sits behind glass, so that cooling air can be directed in a more efficient route at bumper level. Exterior mirrors have been ditched in favour of windcheating cameras, with images viewed on LCD screens at the base of the windscreen.

Some of the Flextreme is pure show-car silliness: the concept includes two Segway electric transporters in a pod beneath the boot floor, for example. But GM insists it is serious about selling a production vehicle based on the E-Flex underpinnings.

"This is not just a concept; this is not going to be a small market," says Andrew Marshall, director of technology communications for GM Europe. He adds that GM has 600 people worldwide working to bring the E-Flex platform to the showrooms.

GM hopes that the combination of electric drive and on-board generation will bridge the gap between today's liquid-fuelled cars and an all-electric future. "The key is the battery, so GM has got involved in the development of the battery itself - not just farmed it out," Marshall says. To this end, GM has established partnerships with battery makers CPI and LG Chem (both subsidiaries of LG), as well as A123 Systems (a US startup developing high-yield batteries employing nanonstructures), and automotive parts supplier Continental.

Marshall also says that GM is evaluating different pricing models, and is considering leasing the batteries, rather than selling them as part of the vehicle.

You can't yet buy a diesel-electric E-Flex Astra from your local Vauxhall dealer, and Marshall is unsure when that day may come, saying only that it is probably three to five years away. But he and Jacob say they are sure that buyers "won't accept compromise".

And that remains the key dilemma for almost every industry attempting to reduce its carbon footprint: how to improve efficiency without pushing customers into the arms of less progressive competitors in the short term. In the long-run, more efficient products and processes ought to win, but getting to that winning position may require a lot of small steps, rather than a few giant leaps.