Hybrid technology does a good job of making cars more efficient, and a very, very good job of making efficient cars more marketable. However, hybrid cars really suck to drive and batteries come with their own host of environmental issues.
Delphi has been working on a high compression ratio gasoline engine that could potentially out-perform a hybrid in terms of efficiency without the need to install expensive and environmentally dangerous batteries in a car. The efficiency of diesel engines come from the 14:1 to 25:1 compression ratios – much higher than the average gas engine's 9:1 – but the emissions equipment required for diesel fuel is considerably more expensive than what's needed for gas engines.
Delphi has already tested a single cylinder engine at idle, load, and acceleration, and is now working on creating a more useful multi-cylinder powerplant.
If they can make this work with hydrogen all of our problem might just be solved, with the notable exception of how to store hydrogen.