Furthermore, as the sporting version (dubbed XR1) would retain most of the original’s lightweight and aerodynamic design, it could apparently offer such performance while still delivering impressive fuel economy.
The 'regular' XL1 weighs 795kg and is powered by a diesel-electric plug-in hybrid system, which Volkswagen claims can return an astounding 0.9 l/100km.
A 0.8 litre two-cylinder diesel engine developing just 35kW of power is mated to an electric motor and a seven-speed DSG dual-clutch transmission.
For the XR1 version, the target weight is reportedly less than 850kg.
Volkswagen hopes to achieve this by replacing the diesel engine, electric motor and associated batteries with a mid-mounted single engine, believed to be the 162kW/350Nm 2.0 litre four-cylinder unit from the Golf GTI.
The body, chassis and drivetrain would need to be re-engineered for maximum performance and the XR1 may even lose some aerodynamic efficiency in the process.
But the end result could potentially deliver 0-100km in less than five seconds, while still returning better than 4.0 l/100km.
The original XL1 was restricted to a production run of just 50 units. But with a target price of around AU $65,000, the XR1 may require a much more generous production run to meet demand.