Q: How do you take a car that gets 26 MPG going up a hill and turn it into a car that gets 6 MPG?
A: Make it send all its power through a nice, lossy torque converter.
Yes, I'm serious. I've got a car with a bunch of nice features, including a highly efficient turbodiesel engine and a trip computer with a not-too-inaccurate MPG meter... and an automatic transmission. (Wasn't available any other way this model year.)
What's wrong with that? For efficiency, plenty. A torque converter is a way to amplify torque at the expense of power; the slip between the two sides causes fluid to be slung around inside like an O-ring being rolled down a rod, and the stator turns some of that circulating motion into extra torque. This is good for getting away from a standstill, but a 3:1 torque multiplication at stall is still... 0% mechanical efficiency. At low speeds, it's easy for 75% or more of the input power to be lost as heat in the torque converter.
(For those who are lost here, consider the situation of a car standing still on a hill, being pulled by the engine just enough to stop it from sliding backwards. You could accomplish the same goal by putting a brick behind a tire and shutting the engine off, but instead the engine is spinning faster than normal and being loaded more heavily than a normal idle just to keep the car in the same place
. All of this power and fuel is being wasted in the slippage of the hydraulic torque converter.)
75% losses means using 4x the fuel that is ideally required for the job. Modern transmissions have "bypass" clutches which lock their torque converters at higher speeds and eliminate the slip losses, but in local and stop-and-go traffic this isn't possible.
Toyota has a better way, in the Prius at least. The Prius has an automatic transmission, but no torque converter. Instead, it has a gear arrangement such that the slip between the engine and final drive moves, not fluid, but a motor/generator. The energy that would be lost in a conventional automatic is turned into electricity instead, and that electricity either feeds a second motor (to add torque much more efficiently than hydraulic fluid) or is stored in a battery. A little bit of slip at the engine can maintain a lot of stall torque at the second motor, making the whole affair much more efficient in low speed, stop-and-go driving. And the electric motors used in cars, unlike torque converters, can create torque at zero speed with a minimum of power being wasted.
Yes, two motor/generators are more expensive than some brazed sheet metal formed into a doughnut-shaped chamber filled with type F. But ask yourself this: how much are you willing to spend to cut the number of madrassas training the next generation of Mohammed Attas?