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Ford is to invest €1.5 billion in the UK over six years to develop technologies aimed at reducing carbon dioxide emissions and raising fuel economy.

The task goes to the 9,000 engineers and R&D people in Ford’s Dunton, Gaydon and Whitley facilities, who will develop more efficient gasoline and diesel engines, transmissions, bioethanol models, hybrids, and light weight vehicle structures. The technologies would be applied across the Ford product range, including the Premier Automotive Group.

Ford stressed that a more unified approach to climate change is required, and that reducing CO2 requires action from everybody, not just automakers. It is saying too that manufacturing cars that are significantly less harmful to the environment will come at a price – in some instances, adding £1000 to the cost.

Ford wants to see governments offer financial incentives to consumers who purchase greener cars. Lewis Booth, executive vice president Ford of Europe and Premier Automotive Group, said: “There need to be systems in place to encourage car buyers to make greener choices.”

Booth cited the fact that hybrids were exempt from the London congestion charge, but not other low CO2 emissions vehicles: “The focus should be on the outcomes rather than the technology,” he said.

Douglas Alexander, UK secretary of state for transport, said: “We can and we must do more to cut CO2 from transport.” He added that a partnership between government, industry and individuals was needed, and that there was a need for better information to raise awareness of how actions impact the environment.

Ford believes that no one hybrid technology can serve the needs of all markets. Richard Parry-Jones, chief technical officer, said: “There is no panacea. We must attack on multiple fronts: broad and deep.”

The group sees the internal combustion engine continuing to play a dominant role in the near future. By raising driveline efficiencies and lowering fuel consumption across the entire range of models, Ford sees the roll-out of technology at high volume as a means of making a large reduction in CO2 emissions.

Over the next five years it says it wants more than 100 models and derivatives to offer improved emissions and fuel economy, and will include a Focus capable of 70mpg and less than 100g/km CO2.

Parry-Jones urged the fuel industry to improve low carbon fuel availability now and referred to the “well to wheels” measurement of CO2 emissions, whereby pollution at all stages is considered and not just at the tailpipe. Using this methodology, Imperial College has calculated that the current E85 Focus flexi fuel vehicle emits less than 100g/km.