The quote was light on details, only mentioning that Bugatti would up the power output of the uber-Veyron to 1,200 HP. The article also mentioned plans for an E-Class Merc that would crest the 700 HP mark.
For the time being, we're chalking this up to rampant speculation since sources weren't cited and there's been no hard evidence about such a project coming across our screens. We like more power, but as far as engineering exercises are concerned, the Veyron is close enough to the limits, as is.
[Source: German Car Blog]