Anyone familiar with a traditional manual gearbox expects to see numbers for the forward gears and an “R” for reverse. But some older gear sticks contain another letter that can leave drivers confused: “E.” It looks like an additional gear, but its purpose becomes much clearer once you know what the letter represents.

The “E” stands for Economy. On certain older manual transmissions, particularly some European vehicles, E identified a high-ratio gear designed to reduce engine speed while cruising. Instead of being intended for strong acceleration, it was meant for situations where the vehicle was already traveling steadily and the driver wanted more economical operation.

When E was selected at an appropriate cruising speed, the engine could run at lower revolutions per minute than it would in a conventional lower gear. That could reduce fuel consumption, engine noise, and mechanical strain during longer journeys. In modern terminology, its function was broadly similar to what many drivers would recognize as an overdrive or fuel-saving top gear.

It wasn’t a replacement for the numbered gears, and drivers weren’t supposed to use it for pulling away or when maximum power was needed. Hills, overtaking, and lower-speed driving could require shifting back into one of the regular numbered gears so the engine remained within a useful power range.

Modern cars rarely display an E in this particular way because transmissions have evolved significantly, with five-, six-, and even higher-speed gearboxes providing efficient cruising ratios automatically or through conventional numbered gears. But on those older gear sticks, the mysterious letter had a straightforward meaning: E meant Economy, a gear intended primarily for efficient cruising.