The next wave for the internal combustion engine is ultra-pure low-sulfur diesel fuel, plus computerized diesel management and exhaust handling.
The engines will be small, 3-4 cylinders 2-liter max, ...about 20 BHP, and will be used in a hybrid configuration to both drive the car as needed and to charge the batteries for electric motors at each wheel. It will be, unlike the PRIUS, a plug-in set up that can be charged overnight to complement dynamic charging on coast or while braking.
And this makes sense because we can use our coal and nuclear resources to provide the elctrical energy needed to supplement fossil, or vegetable fuels. A big plus is that diesel needs somewhat less refinement than gasoline, and can be mixed with bio-fuels.
A peppy family car in this configuration might deliver 55mpg, overall, or even more. Read it and weep, O Sons of Allah! This is already happening in Europe. I suspect that if Chrysler could get enough small diesels from D-B, they would be trying it now.
BTW, today's IC engines are absolutely fabulous, with micro-finishes and tolerances managed out to the 100 Thousandth, they last forever and make even the cheapest flivvers one hell of a lot hotter than many Americans can handle.
One complaint: I cruise my ancient 240,000-mile M-B at 75. I am being continually left in the dust by Honda Civics, which showing their huge rear exhaust pipes, blow my doors off at easily 100+mph, and then disappear over the horizon. What's with this trend?
Yes, plug-in diesel hybrids are a good next step, but the next after that is to eliminate the mechanical drive train altogether.