Jaguar's stunning X-Type replacement breaks cover

The revival clearly continues apace at Jaguar - one of Britain's most historic and industrially important car manufacturers.

Far from resting on their laurels following the recent launch of the new flagship XJ, Jaguar has given the go-ahead to production of a stunning new BMW 3-series rival.

In an exclusive report, British car magazine Auto Express reveals this week that Jag bosses have confirmed that an X-Type replacement is already under development and due to appear in 2012.

According to the magazine's images, the all-new smallest car in the Jaguar range looks set to follow eye-catching design cues set down by the ground-breaking new XF and XJ models.

At the front end will be a subtly re-worked version of the company's new rectangular mesh grille and XF-style swept-back twin headlights.

At the back, trademark curved rear haunches will lead to the marque's new-style smooth rear, complemented by sleek rear lights.

The effect will create a significantly more modern, sporty and muscular stance than that of the existing X-Type.

But it's what will be under the skin that may spell the biggest trouble for BMW, as Jaguar appears to be targeting the German company's reputation for handling prowess.

The magazine reveals that Jaguar is working on an all-new aluminium rear-drive chassis for its new baby model, with the aim of making it the lightest and best handling car in its class.

Under the bonnet, the company may continue to offer a 3.0 litre V6 diesel engine to power the next X-Type. But with ever greater focus on cutting emissions, the mainstays of the engine range will be a pair of four-cylinder petrol and diesel units.

While the old X-Type had a strong band of followers - attracted by the Jaguar brand image and the car's competent, Mondeo-based handling - the model was never a sales success.

Yet for Jaguar to continue the fight back against its key German competitors it must make greater headway in the higher volume market for smaller executive cars.

If the production version comes anywhere close to the images revealed this week, this important new model for the British car industry will look fantastic and ensure the likes of BMW, Audi and Mercedes will soon have a real fight on their hands!