The Lupo was their car in the 1990s that did 100 km per 3 liters of gas, roughly 78mpg. One of its quirks was when the engine was NOT in use, it turned off thus saving fuel, for example waiting for a red light to change the engine would shut off, then when you touched the gas pedal the engine would be re-started. Another quirk was its automated standard transmission tied to a diesel engine. When I said Automated Standard Transmission I do NOT mean an automatic, but a computer driven manual transmission, where the switch of gears is controlled by a computer. The SMART car has a similar transmission.
More on the Lupo: VW stop making it for, once the fanatics of fuel economy had theirs (And then only in Europe it was never imported into the US), the car was expensive to produce compared to other cars of its general size (Those features that made it most efficient was expensive to produce and did not have the glamor or the hybrids).
http://en.wikipedia.org/wiki/Volkswagen_LupoThe Lupo was a "City Car" like the SMART and the Ford KA (Another car NOT sold in the US, but Ford had plans during the 2008 gas price run up, but has since canceled those plans).
The Lupo, the SMART, and the Ford KA, are all based on the concept that the best way to improve fuel economy is to make a smaller car, with smaller engines and smaller transmissions. Between those tree "Smaller" you get a car with much more fuel economy, but a car that has a hard time reaching 50 mph (Thus called "City Cars" in Europe). One of the problems with the SMART Car is that it is really NOT design to operate at 50, but the EPA test is set for 50 mph. The only way these cars can get to 50 mph is to over rev the engine (all these cars can hit 50 mph, just like most cars on the streets of the US today can hit 100 mph). Over revving the engine hurts the fuel economy (especially for a car designed for 30 mph traffic) and thus these cars do NOT do good on the EPA fuel economy tests. Hybrids suffer a similar problem, but in reverse, hybrids do better on the EPA tests then they do in real life, much more then other cars.
Just a comment on why this car does as good as it does in Europe, but will have a much lower EPA fuel mileage if and when it is sold in the US.