The Paris Motor Show kicked off today, with leading carmakers displaying their latest designs and technology.
A big trend at the show this year is creating greener, more energy efficient vehicles that will comply with new rules and regulations on emissions. Many manufacturers presented new ranges of electric vehicles, including Volkswagen, which debuted the I.D., a purely electric car.
"We really think that electric mobility will take off by the year 2020, that's our judgement of the future," Herbert Diess, CEO of VW Brands, told CNBC's Nancy Hungerford.
"China will probably be the lead market for electric cars," he said. "From there, we will really grow volumes very steeply."
Consumers are buying fewer and fewer diesel cars, according to Carlos Ghosn, CEO and chairman of Renault. But the fuel type is not going to go away, as new technology will be introduced to comply with emission regulations -- although this will increase costs.
"It's going to make the car more costly, but this is a cost that can be borne by larger cars, more expensive cars," he said to Hungerford. "For smaller cars, it's a killer, so it means that we're going to have to go for different kinds of technology, more affordable."
However, even as carmakers invest heavily into electric, the infrastructure required to support them is lacking, analysts have warned.
"Alternative energy will (hopefully) one day fulfil the needs of our cities and the environment but the reality is that the infrastructure is not yet in place for this to be the case," said Jürgen Korzer, global account director at research agency Kantar, to CNBC in an email.
"Until it is, classic cars and buying behaviour will remain the same in most markets."
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