By Drew Johnson
Wednesday, Nov 26th, 2008 @ 3:02 pm

Although fuel prices have retreated from their record highs just a few months ago, Volkswagen is fast tracking a new city car. The new model will slot beneath the forthcoming VW Up! and promises to return some astronomically high fuel economy figures.
The new model – which will reportedly be called the ‘Chico’ – will be built on the Up!’s architecture, but will closer match Smart’s ForTwo and Toyota ’s iQ in size.

Thanks to its modified chassis, VW engineers were actually able to make the Chico narrower and lower than the Up!, resulting in better aerodynamics. “The Up! has a tall design and as a result there are limits to its overall aerodynamic performance,†VW chairman Martin Winterkorn told Autocar. “Our newest car is a good deal lower and because of this it carries a lot less drag.â€

Because of its slippery exterior, VW is predicting the Chico will return a class-leading 141 mpg while only emitting 60 g/km of CO2.

Of course the car’s exterior is only part of the equation, with engine start/stop technology, low roll resistant tires and a highly efficient engine also contributing to the Chico’s extraordinary fuel economy.

VW engineers originally planned to power the Chico with a two-cylinder powerplant, but quickly discovered the revs needed for acceleration off the line canceled out any mileage gains on the top end. Instead, the Chico will come equipped with either a direct-injected 1.2L four-cylinder gasoline powerplant or a three-cylinder common rail diesel. An all-electric version is also under development.

Although the Chico won’t likely make it to U.S. shores – then again, you never know – the tiny city car is expected to hit UK showrooms in 2011 with a price tag of £6,000.

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