Rumours are swirling that Volkswagen is preparing a sports car based on its futuristic XL1 plug-in hybrid.

UK publication Car reports the project, referred to by insiders as the Volkswagen XR1, will take the XL1's lightweight carbonfibre chassis and gullwing doors but replace its two-cylinder diesel-hybrid powertrain with something much more powerful.

In a mouth-watering admission, one insider said the Volkswagen Golf GTI’s 162kW 2.0-litre four-cylinder turbocharged petrol engine currently looked “the most promising option”, ahead of a supercharged three-cylinder or a different hybrid set-up.

The effect of mounting the GTI’s engine in the middle of the XL1’s chassis has the potential to be epic, with Car predicting a Porsche 911-beating low-4sec 0-100km/h, a 300km/h-plus top speed, and a sub-900kg kerb weight to undercut a Lotus Elise.

Volkswagen-XL1-2

The XR1 would require engineers to widen and lengthen the existing chassis to accept the larger engine, new dual-clutch transmission and a conventional seating layout.

Car’s insider also said the sports model would ditch the XL1’s rear wheel covers and flat rear end for a more curvaceous appearance.

“The performance version loses a couple of points in the wind tunnel but it looks a lot meaner,” the source revealed.

Volkswagen is yet to give the XR1 project the green light for production, but company insiders are reportedly optimistic about its chances.

The Volkswagen XL1 plug-in hybrid is the most fuel-efficient car in the world, with an official combined cycle rating of 0.9 litres per 100km. Revealed at March’s Geneva motor show, Volkswagen plans to produce just 50 of the revolutionary coupes, which was developed primarily as a showcase of the brand’s technological prowess.