Frankfurt Motor Show

Merkel said widespread "green" car use was still some time off but that her government was making big investments into programs that would push green technology forward and make the eco-friendly cars more readily available on the market.

"Electro-mobility, electric and hybrid cars are very much the future," she said in her opening speech at the show, which runs until September 27.

Merkel also said she hopes Germany will have 1 million electric cars on the road by 2020, which means that it "it would really take another generation of car buyers" before this trend becomes mainstream here.

Merkel said she hopes Germany will remain the automotive leader it is as the face of the industry changes. Some Asian car companies have heavily stepped up production of green cars and are on the cutting edge when it comes to green automotive technology.

"If Asian markets take over the lead role and we lose the upper hand in standardization, then we will also lose he markets," Merkel said.

Merkel also had words of support for the general German car industry in general, which has recently found itself embroiled with the European Commission over environmental standards.

"In a free world, it can't be that we prescribe the size of a car," she said, referring to the EU's plans to penalize automakers that produce larger cars that are less fuel efficient. "If the producers of large cars did not exist, the innovation of small ones could not be implemented so quickly."

Though German car companies have are also producing electric and hybrid cars, they rely almost entirely on profits from standard gas models and aren’t looking to jeopardize the health of that sector of industry.

“Germany is playing it smart with their multi facted approach,” Tim Urquhart, an auto analyst at IHS Global Insight, told Deutsche Welle. “They care deeply about green technology and electric cars and the whole bit, but they're going to wait and see how much the trend catches on. When it comes to all this new technology, no one knows what the end game is going to be. Germany’s hedging its bets."

cs/AP/dpa

Editor: Susan Houlton