The new CAFE rules are putting lots of pressure on shoulders of auto makers. Reason why Jaguar is considering a smaller-capacity turbodiesel version of the new XF saloon.

"We will just have to keep an eye on where the market goes, and if customers start demanding it, we will have to respond," said Mick Mohan, Jaguar’s product development chief.

Jaguar is likely to look into the Ford parts bin for a usable engine: options include boosting the power of the 130bhp 2.0-litre Mondeo TDCi engine, or using the 152bhp 2.2-litre X-type diesel's engine.

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