My first Honda lasted 244,000 miles before I had to let it go. Honda Motors (NYSE:HMC) is well-known for the quality and longevity of its vehicles, and now the Japanese car maker is making an extra effort to ease consumer pain at the pump with new lines of fuel efficient vehicles.

Its efforts are capturing the attention of the eco-friendly Hollywood community. Going green is turning into big business as gas prices continue to climb. Investors should know that Honda is one car maker with a solid stake in the race toward commercializing fuel efficient vehicles on multiple fronts. (To learn how companies make big money with a green makeover, read The Green Marketing Machine and For Companies, Green Is The New Black.)

Honda's Hydrogen
Earlier this week Honda announced that it would begin leasing its FCX Clarity hydrogen-powered vehicle. FCX's only emission is clean water vapor. The vehicle has its own electric engine and a compact hydrogen fuel pack allowing for a driving range of 270 miles before refueling. For a cool $600 per month for a three-year lease, you can have your own zero-emission sedan if you live in Southern California, where drivers have a better chance of finding a hydrogen fueling station. Actress and children's book author Jamie Lee Curtis will be one of the first owners. Honda who hopes her celebrity will draw prospective customers.

Not waiting around
BMW has also recruited celebrities like Edward Norton and Cameron Diaz to promote its Hydrogen 7 Series vehicle. BMW is not traded on U.S. exchanges, but investors interested in ownership should explore the Claymore/Robb Report Global Luxury ETF (AMEX:ROB). General Motors (NYSE:GM), which is working with Magic Johnson to publicize its hydrogen vehicles, is hoping to commercialize its line of zero-emission vehicles by 2012.

(NYSE:TM) whose flex-fuel Prius is already a fan favorite is also focusing on hydrogen power. Its Highlander-based Fuel Cell Hybrid Vehicle (FCHV) is capable of traveling 515 miles on one tank of hydrogen at temperatures near -22 degrees Fahrenheit.

Downsides to Hydrogen
The fuel cells that power the hydrogen vehicles are still very expensive making commercial availability years down the road. There are a limited number of hydrogen fueling stations in country and it is debatable whether or not producing hydrogen is as efficient as diesel powered engines.

What if Hydrogen Can't Cut It?
Not to worry. Honda reports that diesel powered cars represented 27% of the 327,000 cars they sold in Europe last year. European drivers noted their preference for the fuel and power efficiency of diesel powered vehicles. Honda has also had strong sales of its Civic and CR-V crossover models in the U.S. and Europe last year as consumers have turned toward fuel efficient options.

Honda is also bolstered by its increasing sales in emerging markets like Brazil, Russia and China, its sales of motor cycles particularly in India along with its sales of power equipment and its home grown Honda Financing business segment. (Interest in new energy sources is growing? To learn more, read The Biofuels Debate Heats Up.)

Honda Motors is selling flex fuel vehicles which are beloved in Brazil, diesel powered vehicles favored by Europeans and introducing hydrogen powered vehicles here in the newly green envy U.S. Since picking a clear winner of fuel efficient technology may be a waste of time it's awesome if you can place your bet on options with bright future prospects. From my viewpoint an investment in Honda is one road toward the destination of fuel efficiency.

For further reading, be sure to check out our related articles Evaluating Green Equity Investments, and Top 10 Green Industries.

Related Articles
  1. Stock Analysis

    3 Resilient Oil Stocks for a Down Market

    Stuck on oil? Take a look at these six stocks—three that present risk vs. three that offer some resiliency.
  2. Economics

    Keep an Eye on These Emerging Economies

    Emerging markets have been hammered lately, but these three countries (and their large and young populations) are worth monitoring.
  3. Stock Analysis

    Is Pepsi (PEP) Still a Safe Bet?

    PepsiCo has long been known as one of the most resilient stocks throughout the broader market. Is this still the case today?
  4. Investing

    The ABCs of Bond ETF Distributions

    How do bond exchange traded fund (ETF) distributions work? It’s a question I get a lot. First, let’s explain what we mean by distributions.
  5. Stock Analysis

    3 Stocks that Are Top Bets for Retirement

    These three stocks are resilient, fundamentally sound and also pay generous dividends.
  6. Investing News

    Are Stocks Cheap Now? Nope. And Here's Why

    Are stocks cheap right now? Be wary of those who are telling you what you want to hear. Here's why.
  7. Investing News

    4 Value Stocks Worth Your Immediate Attention

    Here are four stocks that offer good value and will likely outperform the majority of stocks throughout the broader market over the next several years.
  8. Investing News

    These 3 High-Quality Stocks Are Dividend Royalty

    Here are three resilient, dividend-paying companies that may mitigate some worry in an uncertain investing environment.
  9. Stock Analysis

    An Auto Stock Alternative to Ford and GM

    If you're not sure where Ford and General Motors are going, you might want to look at this auto investment option instead.
  10. Mutual Funds & ETFs

    The 4 Best Buy-and-Hold ETFs

    Explore detailed analyses of the top buy-and-hold exchange traded funds, and learn about their characteristics, statistics and suitability.
  1. How do hedge funds use equity options?

    With the growth in the size and number of hedge funds over the past decade, the interest in how these funds go about generating ... Read Full Answer >>
  2. Can mutual funds invest in options and futures?

    Mutual funds invest in not only stocks and fixed-income securities but also options and futures. There exists a separate ... Read Full Answer >>
  3. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  4. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  5. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  6. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!