Volkswagen used the backdrop of an auto show in oil-rich Qatar to introduce its most fuel-efficient car ever.

The German automaker claims that its Formula XL1 concept is capable of delivering over 260 miles per gallon. The lightweight, carbon fiber intensive two-seater achieves this incredible efficiency by combining a 47 horsepower, 800cc two-cylinder turbo-diesel engine with a 27 hp electric motor and an extremely streamlined body.

As a plug-in hybrid, Volkswagen says that the XL1 is capable of travelling up to 22 miles on battery power alone before switching to a traditional blended hybrid operation, similar to the way that the Chevrolet Volt works. Top speed is limited to 99 miles per hour, and it can accelerate from 0-60 mph in 11.9 seconds, not fast, but slightly quicker a Smart Fortwo.

This is the latest in a series of so-called “1-liter cars” that Volkswagen has shown over the past several years. The name refers to the goal of creating a car that can travel 100 kilometers using just one liter of fuel, the equivalent of 235 mpg. The XL1 does it with just .9 liters.

Although there are no immediate plans for production, Volkswagen says the XL1 has been developed to the point that a limited run of cars is possible in the near future.

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