Land Rover's new compact Range Rover due next year will be the brand's first vehicle to be offered with a front-drive derivative.

Speaking at a Land Rover eco-technology event, managing director Phil Popham said the Range Rover compact would be available as a front-drive car as well as a 4x4 for efficiency reasons.

Commenting on the fact that 22% of the market for small SUVs is for two-wheel drive vehicles Popham said: "The advantages are better CO2 output and better mpg.

"We're still committed to 4x4 leadership but the Range Rover compact will get into the 120s for CO2 g/km.

"120g/km equates to about 50mpg, which is what we talked about when we launched the concept. It will be better than the current Freelander with stop-start.

The new, yet-to-be-named, Range Rover goes on sale next year and is based on the LRX concept first revealed two years ago.

Popham refused to be draw on pricing for the car, however the Range Rover Sport starts from £45,000 which would suggest the baby Rangey could start from £30,000.

Five names for the new car are currently in the frame according to BusinessCar's sources, but 'Compact' is not one of them. The car's name will be revealed on 1 July this year.

Popham refused to be drawn on sales expectations for the new model but said: "There will be flexible production. We're making sure we have up-side flexibility with our suppliers. We got caught out with Range Rover Sport, that won't happen this time.

"I sincerely hope it will be the biggest selling Range Rover."