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An automatic transmission is an automobile gearbox that can change gear ratios automatically as the vehicle moves, thus freeing the driver from having to shift gears manually (similar but larger devices are also used for railroad locomotives). Most cars sold in the United States since the 1950s have been equipped with an automatic transmission. This has, however, not been the case in Europe and much of the rest of the world. Automatic transmissions, particularly earlier ones, reduce fuel efficiency and power. Where fuel is expensive and, thus, engines generally smaller, these penalties are more burdensome. In recent years, automatic transmissions have significantly improved in their ability to support high fuel efficiency but manual transmissions are still generally more efficient.
Reference link : http://en.wikipedia.org/wiki/Automatic_transmission
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