French automaker PSA Group is trying out battery-powered cars that recharge with an on-board single-piston generator, to become more competitive with rivals Toyota and Renault-Nissan.

Aquarius Engines, an Israeli startup, said a major European carmaker had agreed to fund further development and road tests of its single-piston generator design. The supplier declined to identify the customer, but PSA, the maker of Peugeot, Citroen and DS cars, confirmed its involvement.

“We are evaluating the technology,” said PSA research and development director Gilles Le Borgne. “Nothing has been decided yet.”

Plug-in hybrid technology, also called range extenders, are being taken more seriously by global carmakers since being introduced by General Motors in the 2011 Chevrolet Volt. They’re expected to multiply on the market as the gasoline generators become lighter and more efficient, which could allow plug-in electric vehicles to carry smaller batteries, shedding more weight and cost.

PSA is pursuing an ambitious turnaround following a 2012-14 crisis that led the automaker to securing a cash bailout from the French state and China’s Dongfeng. PSA chief executive Carlos Tavares has pledged to introduce 11 new plug-in electric and hybrid models by 2021.

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Aquarius has pared the range extender down to a single piston with a valveless 600cc cylinder, generating power from electromagnetic coils with each stroke. It delivers more than twice the overall energy efficiency of a typical combustion engine, according to simulations by German engineering firm FEV.

“If the concept works in reality it’s going to have a lot of potential,” said Pavan Potluri, a powertrain analyst with industry consulting firm IHS Automotive. “But vehicle manufacturers are always very risk-averse, so the biggest challenge may be getting one to sign up to it.”

According to Aquarius, several prototype vehicles using its free-piston generator will be road-tested by the carmaker client early in 2017. At an estimated $17,000 per vehicle, costs should undercut both conventional hybrids that come in closer to $25,000 and pure-electrics at around $40,000, the company projects.

Some industry leaders aren’t convinced that the Aquarius technology will resolve the challenges they face. Some believe adding a combustion engine harms the zero-emissions appeal of electric cars as well as their eligibility for green incentives.

Toyota unveiled its own free-piston generator design in 2014 but has yet to announce plans for the technology. Renault has its own prototype two-stroke range extender and no intention of using it, according to a company source. The carmaker had also reviewed the Aquarius kit and decided to pass, the source said.