Detroit Free Press

WASHINGTON – The foundation that sponsored a $10 million prize for a private reusable spaceship will be offering a $25 million award for the first mass-produced vehicle that offers a revolutionary jump in fuel efficiency.

The California-based X Prize Foundation is still fleshing out the rules and the goals for its competition, but began with the idea of a prize to any group that sells 10,000 vehicles capable of 250 miles to the gallon.

Mark Goodstein, executive director of the foundation’s automobile prize, said those guidelines pose several problems, such as just how to measure efficiency. He said the group was now in a “10-week extended brainstorming session” to determine what the competition should look like.

“We hit the ground with two overarching assumptions,” Goodstein said. “One is that the technology exists today to give us an order of magnitude improvement in efficiency, however you measure it. The second is that the prize ought to be defined by the market.”

Goodstein said one set of rules pitched to him would encourage groups to offer modifications to existing vehicles that would increase their fuel economy to 200 mpg and cost less than $10,000 per car or truck.

Such a figure would be nearly 10 times greater than the average fuel economy of a vehicle sold in the United States last year.

There have been vehicles that have clambered to such stingy heights, notably a 2002 Volkswagen AG experimental vehicle that reached 264 miles to the gallon, thanks to a one-cylinder diesel engine.

The X Prize Foundation was launched by Peter Diamandis, an aviation entrepreneur, to fund a $10 million prize to the first private group to launch a spaceship capable of carrying three people about 62 miles above Earth twice in two weeks. In October 2004, a group backed by Microsoft Corp. cofounder Paul Allen won the prize with SpaceShipOne.

Goodstein, a dot-com entrepreneur, said the foundation was close to signing a sponsor who would provide the $25 million prize. While such a figure is almost a rounding error in automotive companies, Goodstein said there could be other rewards for the team that wins, such as investment from venture capital firms or manufacturing contracts.

He said he was still getting in contact with several groups, including automakers, and had received 5+³positive feedback from most corners.

“We want as much involvement as possible, including from car companies,” Goodstein said.

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AP-NY-03-09-06 2006EST