With gas prices on the rise, the demand for high-mileage and low pollution vehicles has taken on an unprecedented role in our society. The production and implementation of electric and hybrid-electric vehicles has recently been a large focus of all major automobile manufacturers. Although these new vehicles have begun to solve much of the expensive fuel consumption and air pollution problems that our economy faces, the initial cost of these vehicles has proven to still be too expensive to capture a significant portion of the market. The further advancement of this technology must not only continue to focus on better fuel efficient and decreased pollution producing vehicles, but also decrease the cost of these vehicles to make them more available and enticing to the general public. Results from this research include one potential solution to reduce the cost of electric and hybrid-electric vehicles. Previous research performed in this area has led to the investigation and bench-top testing of a special type of mechanical system known as a Planetary Differential (PD). An exploration of the functionality of this system has shown that the PD can simplify expensive and complex electronic control systems for electric and hybrid-electric vehicles, thus reducing the cost to the consumer. In this study, fundamental speed, torque and power relationships for the PD were developed and tested under various loading conditions. Advantages and disadvantages of the PD, as compared to other similar mechanical systems, are identified and outlined. Recommendations for future work and implementation of the PD in electric and/or hybrid-electric vehicles are presented herein.