Finally, a diesel hybrid!

XL 1 looking bad-assed. Photo via Daily Mail.

And, one that looks very cool to boot.

Volkswagen has just thrown the gauntlet down in Toyota's face with the XL 1. It claims this baby can get up to 313 miles per gallon, and it will have production models by the end of this year.

A few more specs on this baby:

It can also cover a distance of up to 31 miles (50km) in all-electric mode where it emits zero carbon dioxide.

Overall emissions are a mere 21g/km - less than a quarter of the amount produced by the ultra-green Toyota Prius.

So, there you go!

Now, it's just producing 50 production models for now, and prices have not yet been released. But, still, this is something whose time has come, at least for Europe, with fuel prices around $10 per gallon. It's also given Toyota a design challenge.

Sure, 50 cars isn't quite mass-market, but Japan doesn't do diesels. Until Ford changes its stubborn refusal to bring a prototype diesel-hybrid to market (and yes, it has one) then, we have to rely on VW or another Euro company to do the lifting.