Well directly a water powered engine hasn't yet been invented, but indirectly it has. By putting H2O through electrolysis you can separate its two components into H(2) and O. The hydrogen can then be used to fuel a hydrogen fuel cell engine while the Oxygen will be emitted harmlessly into the atmosphere. after the engine uses the Hydrogen, it will dispose of it and the hydrogen can effectively react with the Oxygen in the atmosphere to re create water. this water can be recycled to begin the process again and in theory, you could create an engine with infinite power on as little as a gallon of water.
Cars which run on Hydrogen are more commonly confused with water-powered cars. So, Per see, the car is dubbed "water powered" because the car extracts the hydrogen from the water and uses the gas to run its' engine. It does this by splitting the oxygen from the Hydrogen/water by way of electrolisys in a small tank in the boot, feeding the engine in the same way as a petrol powered car. But a Hydrogen powered car uses only one or two moving parts in the engine. For alot of people, the thought of the worlds' fuel resources deminishing would be the end of the automobile. And efforts to design a new engine/fuel cell were proving very difficult until the Hydrogen cell was introduced not too long ago. Many, if not all, are hailing the design as the saviour of mankind. http://news.bbc.co.uk/2/hi/business/7456141.stm
Depends on your definition of "car" The first self-propelled vehicle was in 1769-- steam engine. The first internal combustion powered car was 1807..Hydrogen powered. The first gasoline IC car was 1886. First electric 1900. Seems we have come full-circle, the next reliable, available fuel will be hydrogen.
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