Not entirely true, most transmissions have a system of torque converters and Nlutches. The torque converters convert rotational energy into fluid pressure to gain a kind of mechanical advantage. The clutches slip and make heat, usually to allow other parts of the transmission to interact without destroying gears.

Once you get to cruising speed the transmission usually engages something called a "lockup" that bypass all that to get as close to the 100% number for energy transfer as possible.