NETANYA, Israel — Israeli and Jordanian officials and executives are reported to be in discussions with executives from Renault and Toyota about setting up Israeli-Jordanian factory to make environmentally-friendly electric cars.

Toyota, has already grabbed the moral "high ground" with its Prius hybrid electric-and-petrol vehicle, and is now starting to enjoy the commercial returns on a global basis.

Plans call for the car factory to be located near the Israel-Jordan border, in an area called Peace Valley. The initiative has been discussed at the World Economic Forum, held in Davos, Switzerland, and in Jordan, according to Israeli media reports. The informal talks in Davos involved executives from Renault and Toyota, according to the online site IsraelNationalNews.com. The discussions in Jordan involved Jordan's King Abdullah, Israel's deputy prime minister Shimon Peres and an unnamed European industry association. Peres has promised government grants and tax incentives to the car manufacturers, according to reports. The initiative was inspired by Shai Agassi, who recently quit his position as the chief technology officer of the software giant SAP AG (Munich, Germany). Agassi joined SAP in 2002, as the result of the acquisition by SAP of his two startups, TopTier and TopManage (both based in Ra'anana, Israel), for several million dollars. Agassi left SAP (officially in early April) and said he wished to focus on "green" issues. He has said that Israel should aim to end its dependence on oil within 10 years, and the creation of an electric vehicle industry would support that aim. Agassi is cooperating with Eitan Wertheimer, who last year was paid $4 billion by Warren Buffet's Berkshire Hathaway, for an 80 percent stake in the metal-cutting tools company, Iscar (Segev, Israel).

However an electric vehicle project faces challenges, not least the creation of a light but durable electric battery that will start the car. Agassi hopes Israeli R&D engineers will find solutions for these problems, which would eventually benefit the global economy.

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