This is the first car to use the new ‘Hybrid Air’ engine system, which combines petrol with compressed air. The firm says the car could reduce petrol bills by 80 percent when driven in cities.

In a press release, Peugeot said that the air power would be used solely for city driving, automatically activated below 43 mph. This car will be able to run either on petrol or air or a combination of both. The release said that by 2020, the car could achieve an average of 117 miles a gallon.

This new engine system will prove beneficial for hybrid car owners as expensive batteries would no longer be needed. According to the company, the cars running on hybrid air engine would be cheaper than the current hybrid models. Also, the drivers will never risk of running out of compressed air because the engine of the car would ensure that the air replenishes itself.