The Volkswagen Up is one of our favorite 'forbidden fruit' cars.

Sold in Europe, it's a rival to vehicles like the Chevrolet Spark in the 'A' segment. It's lightweight, simple, economical and inexpensive to buy--everything a small car should be.

Some of those parameters could be about to change, as Volkswagen debates installing a high-tech powertrain in the car for even greater economy.

Volkswagen Up: Forbidden Fruit First Drive

According to Autocar, VW is developing an Up using the two-cylinder diesel hybrid drivetrain found in the XL1 plug-in hybrid, newly announced for production.

In that car, optimized aerodynamically and using an ultra-lightweight carbon-fiber chassis, VW is claiming as much as 261 mpg.

In the more conventional Up, it could still be capable of more than 200 mpg on the European test cycle.

We usually suggest a 15-20 percent discrepancy between European and EPA figures, so if such a car were to come to the U.S.--which it almost certainly won't--an EPA-rated 160 mpg could be achievable. Figures of around 75 mpg could be possible on diesel alone, in part thanks to a sub-2,200 lb curb weight.

For comparison, the regular up gets official European combined economy of 57 mpg--around 45 mpg, EPA-equivalent.

Volkswagen Up: The coolest high-mpg small car we can't have

The 800cc twin-cylinder turbodiesel engine is essentially half that of the 1.6-liter diesel commonly used in European Volkswagens.

It develops 47 horsepower on its own, and a 27 hp electric motor and 5.5 kW battery pack provide additional power (enough for 30 miles of electric range). Drive from the two power units is sent through a 7-speed dual-clutch automatic transmission.

Beyond this, little more is known about the car--it's still undergoing engineering development and isn't expected to debut for another 18 months.

Even when it does, it's unlikely to hit U.S. shores. The Up hasn't been federalized for safety or emissions requirements, and this new variant will be no different.

Given the XL1's expected $100,000 price tag though, an Up with similar drivetrain technology might not be as appealing as it sounds anyway--a high price tag would take away a significant part of the regular Up's appeal.

You can find out more on the XL1, and other vehicles debuting at the Geneva Motor Show, by heading over to our dedicated show page.

+++++++++++

Follow GreenCarReports on Facebook and Twitter.