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Jaguar mulls 2.2-diesel option for XF

Date: 08 January 2009   |   Author: Julian Rendell

Jaguar XF

Business drivers will have to wait at least two years for a low-CO2 Jaguar XF variant with a four-cylinder diesel, even if the company decides to go ahead with the model.

Jaguar's R&D teams are working on a Jaguar-ised variant of Peugeot's 2.2-litre engine, which also powers the Land Rover Freelander.

Potentially, it could give Jag's rival to the BMW 5-series below the 160g/km capital allowance threshold due in this April.

But whether the engine ever gets slotted into the XF premium saloon is still to be decided, a senior company source told BusinessCar this week.

Although Jag's main German rivals - Audi and BMW -score big fleet sales with four-cylinder diesel versions of the A6 and 5-series, Jaguar remains unconvinced the business case for an XF 2.0D is strong enough.

"We're still monitoring the situation and you would expect us to be ready if we needed it," Mick Mohan, Jag's chief programme engineer told BusinessCar, "but at the moment we're not committed."

If a decision to do the model is taken, the engineering program to install it would take at least "two to three" years, according to another Jag engineer.

Both BMW and Audi register around 50% of A6 and 5-series sales with 2.0-litre, four-cylinder diesels, a market that Jag is currently excluded from.

At £25k and £28k, respectively, the Audi and BMW undercut the cheapest £34k Jag diesel by between £9k and £6k, translating into keener entry-level monthly lease rates.

Mohan, however, believes Jag's higher standard equipment levels - for example an auto 'box and leather - close the gap to similar affordability.

Jag is also concerned to retain brand exclusivity by not over-supplying XFs.

Jag will hope a new 3.0-litre version of its 2.7-litre V6 diesel will further increase business sales when its goes on sale in March.

Despite making more power and torque than the 2.7, the two new 3.0 variants generate 240PS and 275PS yet both rate 179g/km.

The outgoing 204PS 2.7 rated 199g/km, meaning the new engines shift the XF diesel down four benefit-in-kind bands from 30% to 26%.