Jaguar’s new sports saloon, the XE, is preparing to take on the German marques such as the Audi quattro and BMW xDrive thanks to the introduction of all-wheel-drive technology. It will be available on the higher powered 2.0-litre diesel automatic version of the XE and Jaguar claims that the new powertrain gives the XE class-leading handling characteristics in poor conditions.

The AWD XE is priced from £33,825, which is £1,800 more than the rear-wheel-drive auto and £2,750 more than the six-speed manual XE.

However, overall performance is not really affected with a top speed for both models of 140mph and the four-wheel-drive car achieving 0-60mph in 7.5 seconds – a fraction slower than the rear-wheel-drive version.

The main difference is fuel economy but even so the XE AWD is rated at 60.6mpg with emissions of 123g/km compared to an official fuel return of 67.3 to the gallon in the two-wheel-drive variant.

Jaguar has developed its new 4×4 system in conjunction with off-road experts at sister company Land Rover and it is similar to that which will be deployed on the F-PACE SUV.

It is fully automatic and in regular conditions allows the car to remain rear-wheel-drive, switching power to bring in the front wheels only when required.

The new drive system, which arrives next year, is only available with Jaguar’s home-grown 180PS Ingenium diesel engine and the eight-speed ZF automatic transmission but is being offered in all trim levels apart from S grade which is currently reserved for the high performance supercharged V6 XE.