If the Lexus CT200h wasn't evidence enough that the Japanese luxury car maker sees downsizing as an important brand strategy, then plans for a new small hybrid engine in the GS sedan could be further proof.

The smaller hybrid would join the 2013 Lexus GS 450h hybrid that was revealed at the 2011 Frankfurt Auto Show, though unlike the 3.5-liter V6 GS the smaller version may only be released in European markets.

UK magazine Auto Express spoke to Lexus deputy chief engineer Koji Sato, who revealed "We are working on a number of solutions to offer low CO2 emissions and these include a small hybrid."

Lexus currently offers the CT 200h, current generation GS 450h, LS 600h and RX 450h in the European market as well as a diesel version of the Lexus IS, but wants more models to compete with European rivals on CO2 emissions.

There are several potential options for a smaller, four-cylinder hybrid, but there are two likely candidates. One is the 2.5 four-cylinder used in the HS 250h.

The other, if Lexus intends to match some the sub-120g/km CO2 of the BMW 520d EfficientDynamics, is the 1.8 from the CT 200h, though this may require re-working to develop more power in the much larger GS body. Auto Express estimates a power output of around 180bhp, and combined economy on the European cycle of just over 41mpg - so likely low to mid-30s by EPA standards.

The exact specification is yet to be decided but the model could be officially announced next Summer.

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