Hybrid electric vehicles (HEV) enable reduction of emissions without sacrificing consumer expected range and drivability. The diversification of the powertrain with multiple power sources allows downsizing the internal combustion engine and implementing optimal energy management strategies. The interaction among components of an HEV are key to the overall efficiency. Therefore, efficiency potential is lost if this interdependence is neglected during the powertrain design by focusing on individual optimization of component specifications. This letter formulates and solves a co-design problem by integrating the energy management with the optimal powertrain and drivetrain component sizing for a hybrid powertrain equipped with an opposed piston (OP) engine in a series architecture. Our novel approach develops a model for an OP engine and integrates battery capacity degradation into the co-design problem. The optimal solution allows for a minimally sized engine that accounts for the average power requirements, and a large enough battery to provide fast power dynamics.