Famed car designer Gordon Murray will team up with former Honda engine specialist Osamu Goto and oil company Shell to develop a concept for "an ultra-compact, efficient car for city use based around the internal combustion engine."

It's not intended for production. Instead, the project's ambitions are far broader, as Murray discussed in an interview with Green Car Reports this morning.

The goal of the project is nothing less than a "step change" in the efficiency of engine-driven vehicles, both in operation and in their manufacturing.

DON'T MISS: Gordon Murray's T25 Minicar Finally Revealed (Jun 2010)

The Project M concept is to be a "simple, practical, global city car" that's even lighter, more aerodynamic, and more efficient than Murray's first T25 design for a city car, released almost five years ago.

That concept vehicle was largely designed to demonstrate the iStream production process that Murray says radically reduces the cost and energy of building cars in any segment.

The T25 of 2010 was a tall, narrow, three-seat minicar powered by a three-cylinder engine driving the rear wheels. (An electric variant, the T27, was also shown at the same time, but it will not be a part of Project M. )

Gordon Murray Design T25 Minicar

Gordon Murray Design T25 Minicar

The low-energy iStream manufacturing process significantly reduces the capital investment required to produce a vehicle, including the energy required for manufacture.

It involves no stamped metal components, and Gordon Murray Design has spent the past three years engaging with "more and more real-world customers" to prove out the concept.

At the moment, he says, the company is in serious negotiations with five separate global vehicle manufacturers on eight different models--from city cars through five-seat sedans to 3.5-ton commercial trucks.

ALSO SEE: Tiny T25, T27 Three-Seat Minicars Delight To Drive, But Not For U.S. (May 2012)

Project M brings together Murray's company with engine designer Goto, who he first worked with a quarter of a century ago, and Shell, a longtime sponsor of efficiency events like this weekend's Shell Eco Drive.

Goto and the Swiss specialty engineering firm Geo Technology will focus on increasing the efficiency of the engine, based on the 0.66-liter three-cylinder unit used in the outgoing generation of Smart ForTwo vehicles sold in Europe.

The firm believes that further improvements in thermal efficiency are possible, as well as significant reductions in internal friction using coated materials rather than today's "rough" metal components.

Gordon Murray T.27 crash test

Gordon Murray T.27 crash test

That's where the Shell Lubricants team comes in; it will design lubricating oil specially for the resulting engine, as well as grease and other lubricants for other vehicle components.

The efficiency gains possible due to lubricants are higher than many realize, Murray said. he noted that a T25 running in the 2010 Brighton-to-London Future Car Challenge achieved a 6-percent boost in overall efficiency when it switched to custom-designed oil, fuel, and greases.

Shell and Murray go back considerably further, however: The company sponsored the first car and engine he ever built, at age 19 in South Africa.

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His own team, meanwhile, is taking a fresh look at the vehicle's packaging and aerodynamics--both areas in which he feels further improvement is possible.

Murray has "materials specialists scouring the globe" for the latest in plastics and other non-metal materials, he said, that can improve on the strength, safety, low assembly cost, and energy content of those in the 2010 concept.

"I've spent most of my adult life dedicated to lightweighting and efficiency in motor vehicles," Murray told Green Car Reports.

Gordon Murray

Gordon Murray

 

What excites him the most, he said, is the chance to reassess "every single aspect of the existing design, in a real-world vehicle" that will result in the final Project M prototype, which is due as a running vehicle this coming November.

He stresses the synergies among every aspect of the design, the holistic approach that sees structural engineers working side-by-side with powertrain designers to optimize every last aspect of an already revolutionary vehicle.

Asked about the choice of a "city car" as a development platform, Murray is honest: The firm owned the car, and knew it well, so it provided a good base from which to start.

RELATED: Now We Know: U.S. Buyers Don't Much Want Tiny Two-Seat Cars (Jan 2013)

The projection that up to 75 percent of a global population of 9 billion humans will live in urban environments by 2050 has been widely highlighted; presumably they too will want cars.

Murray noted that city cars are applicable to at least parts of every major vehicle market except North America.

City cars, Murray said, are "very relevant to the whole of Europe, Japan, much of Southeast Asia, and at least four large cities in South America" as well.

The data show that the smallest "city cars" haven't really caught on with U.S. buyers: Smart sells roughly 10,000 ForTwo minicars a year, and Scion has just withdrawn its iQ "3+1 seater" after its sales failed to live up to expectations.

Gordon Murray Design T25 Minicar

Gordon Murray Design T25 Minicar

Driving characteristics in North America are different, Murray noted. Gasoline is cheap by world standards and congestion occurs on highways as much as in city centers.

Other factors that Murray didn't mention include greater distances covered per year, larger people, and no effective mass-transit alternatives in much of the country.

But Muray underlined the applicability of the iStream manufacturing process to any category of vehicle.

So what kind of efficiency improvements does he envision?

Gordon Murray Design T25 Minicar

Gordon Murray Design T25 Minicar

In tests, the T25 that was released in 2010 returned fuel economy of about 80 mpg in some mixed driving cycles. And Murray feels there's still upside remaining.

Shell is still working out how it will test the Project M concept's on-road fuel efficiency.

But Murray expects the bulk of the testing to be done in real-world driving conditions rather than laboratory testing under regulatory test cycles.

He noted the increasing discrepancy in Europe between official ratings of fuel efficiency and what buyers get from their cars in actual use.

Gordon Murray describes his Batmobile

Gordon Murray describes his Batmobile

And he stressed that the gains had to be apparent in the uses to which actual drivers would put their cars--regardless of segment.

The official launch of Project M occurs this week at the Americas round of the Shell Eco Marathon, a longstanding series in which teams of students from across the globe compete to design, build, and test highly efficient passenger vehicles.

The Americas round opens today in Detroit, and lasts through Sunday.

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