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They're planning to use a 1.4L (turbo?) gasoline inline-4 engine as the generator last I heard. That was the death of it for me. Even in a super-lean-green-atkinson-cycle burning machine fashion I can't imagine it getting much better than 100 mpg out of it on gasoline alone. If they'd used something like a 600cc turbo engine, then I may have been more receptive.
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I think it makes a lot of sense. Again, as Christ and cfg83 mention, as a series hybrid, the engine can be tuned to be a very efficient generator, running in a narrow rpm range. Size the engine/generator system to produce a bit more than 100% of 75mph, five passenger, plus 200lbs cargo, electrical load and there you go. That's a high enough load as to not strand anyone. Cycle the engine on and off as needed to maintain charge.
Joey,
It isn't a 190mpg engine. It is the advantage of a series hybrid, which smooths out the peaks and valleys of engine load. The engine switches on, runs at a specifically engineered load and rpm, and turns off. Conventional engine vehicles, including the Prius, allow the engine to vary across a broad range of rpm and load. The trade off for lots of flexibility is inefficiency. The other upside of a series hybrid is that you can eliminate mechanical losses, like transmissions and such.