Tata Motors chief executive Carl-Peter Forster has acknowledged that Jaguar needs a smaller, higher-volume vehicle and it appears that just such a car is already under development. Unlike the less-than-stellar X-Type which was based on the second-generation Ford Mondeo, the new car should actually be a real Jaguar.

Jaguar is reportedly working on a new modular aluminum platform that would be shared between the new smaller car, the mid-sized XF and the next-generation XK. In renderings posted by AutoExpress at least, the baby Jag bears a strong resemblance to the XF but with curvier rear haunches and XJ-style taillamps. Of course, what the real thing will ultimately look like is anyone's guess.

Power will likely come from downsized and boosted four-cylinder gas and diesel engines, with the current 3.0-liter diesel V6 as a range-topper. Also look for a hybrid to enter the mix. All of this will help Jaguar meet the new EU CO2 emissions limits once the new smaller Jaguar debuts, which could happen as soon as soon as 2012.

[Source: AutoExpress]