Autocar is reporting that the compact Jaguar XE sports car due in about two years time will be based on a shortened version of the XK's extruded and cast aluminum frame. The dimensions are supposedly going to challenge those of the Mercedes SLK, and that narrower chassis created for the XE could then be lengthened something that would "compete in the compact premium segment."

Engines - which would go up front, not in the middle – could include an outsourced and blown four-cylinder, or a V6 developed from Jaguar's new 5.0-liter V8. Lotus is again tipped to be helping Jaguar sort out the car's dynamics, and might even manufacture the car.

[Source: Autocar]