MORGAN and QinetiQ are joining forces to build a car whose only exhaust emission is water vapour.

LIFECar project, unveiled this week, aims to build the world's first environmentally-friendly sports car.

The project is headed by Charles Morgan, whose grandfather H F S Morgan founded the company in 1910.

The LIFECar will be based on Morgan's Aero 8, the first sports car with an aluminium chassis, launched in 2000.

Instead of a traditional petrol engine, the LIFECar will be powered by a QinetiQ-made fuel cell, which converts hydrogen - and oxygen taken from the air - into electricity.

It will be clean, quiet and economic and the only waste product from the car will be water. The makers also say it will be a lot more efficient than other prototype fuel cell vehicles.

"This is a product which captures the imagination," said Mr Morgan.

"LIFECar promises to combine advanced technology while retaining the best in traditional ways of designing and building cars.

"A sports car that is beautiful, brilliant to drive but pollution-free must be a goal worth striving for."

The project has been costed at £1.9 million, with funding coming from the Department of Trade and Industry and also the car industry.

The project is expected to last two-and-a-half years and the prototype will be built at the Pickersleigh Road factory, where Morgan cars have been built by hand for decades.

The fuel cell is being developed by QinetiQ at its site at Haslar, near Portsmouth, but staff from Malvern are expected to get involved.

Other organisations involved in the all-British partnership are BOC, Oxford University, Cranfield University and OSCar Automotive.