During a round table interview at the recent New York Auto Show, Jaguar’s design director Ian Callum told motoring.com.au that the brand is investigating the idea of a producing such a vehicle.
"I think there's a huge opportunity in the small car market, but it's a very difficult business – hugely competitive and hugely price conscious," he said.
For now, Jaguar are not able to meet the volume required or be price competitively enough to tackle the small-car market. However, the recent introduction of the F-Pace crossover SUV shows the company is willing expand beyond its current offering of sedans and coupés.
"I am of the opinion that if you go any smaller than XE you have to go front-wheel drive. I think the world will accept that. Even BMW is accepting it.”
Should Jaguar decide to take on such a task, it would require the development of a new chassis architecture which is still several years away. The British carmaker’s new arsenal of engines would certainly be well suited for a project like this with a number of four-cylinder Ingenium petrol and diesel engines at their disposal. Tag on electrification and a hybrid powertrain could be another option as well ala Lexus CT200h.