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BMW is working on a range-extending hybrid that will achieve 588 miles per gallon

BMW and Tesla are in the midst of a war for alternative energy vehicle buyers, and they’re sticking to their guns. BMW is a proponent of fuel cell technology as the way of the future, while Tesla’s CEO, Elon Musk, claims lithium-ion batteries won’t be outclassed anytime soon.

Now Automobilwoche is reporting that the German automaker is developing a model that uses just 0.4 liters of fuel per 100 kilometers. That converts to about 588 miles per gallon U.S. and 706.2 mpg U.K.

Automobilwiche’s sources also state the vehicle will be a four-seater made from a carbon-fiber reinforced plastic body with an ultra-low drag coefficient. Adding to its fuel-sipping characteristics will be a curb weight of less than 2,645 pounds. By comparison, the BMW i8 weighs 3,455 pounds and averages 28 mpg when its 1.5-liter three-cylinder engine is operating.

While it appears this won’t be a fully electric model, the range-extending electric vehicle will use a two-cylinder gas engine to generate power for an electric motor. The combination won’t be performance focused like the i8, but it will reportedly have a top speed in excess of 111 mph.

Don’t count on BMW’s new project making it to production in its development form, but there’s a good chance what BMW learns from its engineering will trickle down to future i-Series cars. Presently, the closest comparison to the proposed vehicle is Volkswagen’s XL1 and its plug-in diesel electric hybrid powertrain that achieves 240 mpg US.

For those who want purely electric offerings, Tesla is attempting to corner that market with its Model S, Model X, and upcoming Model 3 sedan and crossover.