2016 Jaguar XS

We’ve known for quite some time now that Jaguar has been working on a smaller luxury sedan that will take on models like BMW 3-series, Mercedes C-Class and Audi A4. After much speculation, the car has finally been taken out for a test session and the first details suggest the model could be named the XS.

The mule caught testing today is a chopped-up Jaguar XF and is testing the suspension and powerplant, which is apparently a diesel unit. Along with the engine tested here, Jaguar will also offer a turbocharged four-cylinder engine for the base model and a supercharged V-6 for the top version.

The car is internally known as project X760 and will initially be offered as a sedan, but Jaguar will also offer station wagon and a crossover variants. We also expect a more powerful R version with its sights set on the M3 and C63 AMG.

You have to remember that this is just a mule and looks nothing like the final product. Expect the Jaguar XS to hit the market in 2015.