Honda says it has found a way to improve the efficiency of hybrids—and in all likelihood significantly lower the cost to build them. For its new Honda Accord Hybrid, which goes on sale across the U.S. at the end of the month, it’s done away with the car’s transmission.

Hybrids could help automakers meet fuel economy regulations, but their sales are limited by high costs, which are as much as $5,000 more than conventional cars. It may eventually be possible to reduce the price gap to zero, according to a spokesperson from Honda.

Hybrids typically use complex transmissions, or power splitters, to coordinate between the gasoline engine and electric motor that propel hybrids. To get rid of this system, engineers designed the new Accord Hybrid so that most of the time the gas engine isn’t mechanically connected to the wheels. It serves only to spin a generator, which charges a battery. The battery then delivers electricity to a motor that drives the wheels. Electric motors can operate over a wide variety of speeds, eliminating the need to shift gears. To this point, the new design isn’t novel–it’s known as a series hybrid design.

But series hybrids aren’t always as efficient as hybrids that use a transmission. You lose energy when you convert the mechanical energy from the engine into electric energy to charge the battery, and then back into mechanical energy via a motor. (Taking this hit makes sense sometimes, since storing energy in a battery makes it possible to keep the engine operating in its sweet spot, avoiding loads and speeds where it’s very inefficient.) In the early days of talking about the Chevrolet Volt, GM made it sound like it would be a series hybrid. But engineers introduced a complex transmission to allow the gas engine to drive the wheels directly in some situations, improving efficiency by 10 to 15 percent.

Honda found a simpler approach. It uses the electric motor to get the car up to a steady, highway speed. At that point, a clutch allows the gas engine to drive the wheels directly. Basically, the car has only one high gear, and it uses the electric motor in lieu of all the other gears.

Honda says this system is key to allowing the car to get 50 miles per gallon in the city and 45 miles per gallon on the highway, impressive figures for a car its size. In comparison, the non-hybrid version of the Accord gets 26 mpg city and 34 mpg highway, and the similarly sized Toyota Camry Hybrid only gets 43 mpg in the city and 39 on the highway. (The Ford Fusion Hybrid officially comes close, with 47 mpg in both the city and highway, but Consumer Reports found the actual mileage was far lower—just 35 and 41 in city and highway.)

The new approach does have the potential to reduce costs and improve efficiency, says John Heywood, a professor of mechanical engineering at MIT. But he notes that transmissions are also getting very efficient, so every automaker isn’t necessarily going to take this path. He expects the cost difference between hybrids and conventional vehicles to decline to $2,000 by 2030. “Costs will come down, but there’s a lot more stuff in a hybrid, so it’s inevitably going to cost somewhat more,” he says.