DETROIT (AP) - General Motors Corp. will be able to increase fuel efficiency by as much as 25 per cent using a new technology on certain large trucks and sport utility vehicles, an official said today.

By using ''displacement on demand,'' GM says it has discovered a way to squeeze up to 25 per cent more fuel efficiency out of a V8 engine.

GM's plant in St. Catharines, Ont., will be one of two plants initially producing the new Vortec V8 engines.

The new Vortec V8 engines will be installed beginning in the 2004 calendar year in GM's large trucks and sport utility vehicles, spokesman David Roman said today.

Using computer sensors, the displacement on demand technology automatically shuts off four of the eight cylinders during normal driving conditions. Roman says that usually will happen in third or fourth gear, regardless of whether the transmission is automatic or manual.

''If you're pulling a trailer it will be in V8,'' Roman said. All eight cylinders also are reactivated during acceleration.

Initially, 150,000 Vortec V8 engines will be produced at plants in Romulus, Mich., and St. Catharines, Ont. By 2007, GM (NYSE: GM) hopes to build about 1.5 million of the fuel-efficient engines.

The new engine will be installed as standard equipment and the company expects a ''minimal'' sticker price increase to cover the cost of the engine.