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FortuneGovernment needs to support research for clean energy-powered cars. But auto makers need to make their own success.

America’s auto industry is at an unprecedented crossroads.

At the core of the debate is whether American car companies can adapt to a changing marketplace where the demand for greater fuel efficiency and cutting edge design supersedes brand loyalty and vehicle size.

The auto industry of tomorrow – which already is emerging – will be based on a different model. It will reward innovation. It will cater to new economic realities. It will listen to customers. The question is, will it be located in the U.S., or elsewhere?

Driving change: Innovation is key to the future of U.S. auto industry - Fortune Brainstorm Tech