By Alan Clendenning

25-08-04

If it wasn't for the TotalFlex logo on the new Gol subcompacts leaving a sprawling Volkswagen plant, the shiny cars would be indistinguishable from millions already on the road across Latin America.

But these Gols and other models produced by Fiat and General Motors have modified engines that, given the rising price of oil, are making Brazilians smile at the gas pumps. They run on gasoline, alcohol or any combination of the two and now represent nearly 20 % of the new cars sold in Brazil.

With alcohol -- also called ethanol -- selling at half the price of gas in South America's largest country, Brazilians who have bought 200,000 so-called flex-fuel cars since their launch last year say deciding which fuel to use is a no-brainer.

"Alcohol, all the time," said office manager Roseli Santana as she filled up her 2004 subcompact GM Montana pickup at a Shell station in Sao Paulo, Brazil's largest city and home to 5 mm cars. "I was using 52 reals ($ 17 US) of gas every week, now I'm paying 30 reals ($ 10) for the same amount, except it's alcohol."

Brazil hopes to export flex-fuel cars and technology around the world, and auto industry executives say interest from abroad is increasing. So far, Volkswagen has hosted delegations from Australia, China, England, India, Japan and South Africa.

"They want to know how it works," said Joao Alvarez Jr., the top engineering executive for Volkswagen's Brasil's flex-fuel car line-up, which has the biggest market share. "Gasoline is going to run out someday, everyone knows that."

Engine and assembly line changes to make flex-fuel cars aren't complicated, though the cars come outfitted with a tiny gas-only tank under the hood smaller than a windshield wiper fluid reservoir. It's used to start the car on cold days just for a moment before automatically switching back to alcohol or whatever is in the main tank.

But mass exports of flex-fuel cars aren't likely in the near future, because no other country has an alcohol fuel production and distribution system as advanced as Brazil's. Virtually all the country's service stations offer alcohol.

The idea for non-gas powered cars goes back to the 1970s fuel crisis, when Brazil's economy nose-dived, prompting the country's military dictatorship to launch a campaign to wean the country from expensive, imported oil.

Government subsidies helped fund the design and manufacture of alcohol-only cars. They also supported a vast industry near Sao Paulo to cultivate sugarcane and refine it into alcohol, and an alcohol distribution network that spans a country nearly the size of the continental United States.

Millions of Brazilians switched to the alcohol-only cars in the 1980s, but a 1989 shortage of alcohol left enraged motorists unable to fill up and drive their cars. Falling gas prices in the 1990s added to the end of the country's affair with alcohol-only cars.

Last year's sales of alcohol-only cars represented only 3.5 % of new vehicle sales.

Source: Canadian Press