How can more than a billion people travel to and fro, around and through some of the world's most populous and fastest growing cities—without creating epic traffic jams, tapping imported oil or exacerbating noxious air pollution? That's the challenge facing China as it develops a transportation system for its increasingly urban, car-buying population.

A few decades ago, China's city streets teemed with bicycles, earning it the nickname "bicycle kingdom." But today the country's capital ranks as having the worst traffic on the planet, according to a report from IBM. Last summer, a 10,000-vehicle traffic jam snarled more than 60 miles of the Beijing-Zhangjiakou freeway and lasted for 10 days.