Designing an entry-level car is a dangerous game for luxury automakers. It’s no small order to design a car that’s within reach of the common man while still extolling the virtues of a storied marque. By the time it was released in 1982, Mercedes-Benz had famously spent close to a billion dollars (nearly $3 billion today) to make sure its W201 car (commonly known as the 190e) would drive like its flagship S-Class. That car evolved into the venerable C-Class, one of the big guns alongside the BMW 3 Series, Audi A4, Lexus IS, and the upstart Cadillac ATS. But automotive history is littered with the bones of contenders who weren’t so lucky. Cars like the Cadillac Cimarron, BMW 318ti, Cadillac Catera, Mercedes C 230, and Jaguar X-Type didn’t just fail, they dragged the brand down. And catastrophes like that can take decades to undo.

So when Jaguar announced that it was building a BMW 3 Series-fighter (shorthand for “joining the entry-level luxury car segment”), we followed its development closely, even making sure that we were front and center when the 2017 XE made its American debut earlier this year at the New York Auto Show. Still, there were questions; would the new model fall into the same traps that befell the badge-engineered X-Type, that bargain-basement Ford Mondeo/Lincoln LS in a cheap tweed suit, or could it actually compete in one of the most competitive and conservative minefields of a segment in the entire industry?

After a brief drive, we’re convinced that yes, it certainly could.

Back in September, we got our hands on a 2016 F-Type R convertible. The entire Autos Cheat Sheet team was captivated by its looks, sound, build quality, and speed (we also might have terrorized a few Burlington, Vermont residents with it). So it was a good sign that on first sight, the XE R-Sport we drove in Los Angeles reminded us of Jag’s range-topping sports car — and not just because both were done up in Caldera Red. Outside, Jaguar has done a fine job taking the bold styling language of its range-topping XJ, and spreading it across the entire lineup. The XE is muscular and exciting enough to stand out from the competition without looking ostentatious or busy. On looks alone, it already rises to the top of its segment, and it doesn’t even go on sale here until next spring.

Climbing inside the XE’s nicely-appointed cabin, we found traces of the F-Type everywhere. Same starter button, same rotary gear selector, same steering wheel, familiar instrument layout. The comfortable and well-bolstered seats wouldn’t have been out of place in the sports car either. But this ain’t laziness on Jaguar’s part, this is spreading the wealth in the best way possible. Try finding this much excitement inside a conservative C-Class, inoffensive 3 Series, or antiseptic A4 cockpit; we think you’d have a pretty hard time. 

To say the XE is new is an understatement. Its ground-up development was more Mercedes W201 than Jag X-Type, and it shows. Our test cars were so new, in fact, that they were brought up from Mexico for the occasion, kitted out in European S-Spec trim with their speedometers in kilometers. We’ll get this car stateside as the R-Sport. The XE is the first car built on Jaguar-Land Rover’s new aluminum architecture, which keeps weight down and fuel economy up. It also helps in the car’s handling, giving it a responsive and firm feel without ever feeling overpowered.

Which brings us to the driving experience, which was a joy under two extremes: Downtown L.A. gridlock right before a One Direction concert, and an autocross course. The Jag’s greenhouse was open and airy, with a good enough view of traffic that we never felt we were riding in a gun turret (a sin automakers get away with way too much). Dash layout is clean and intuitive, with excellent soft-touch materials and nicely-stitched leather, all things I had plenty of time to contemplate in the stop-start traffic. And speaking of stop-start, the XE’s function is refreshingly unobtrusive, which is more than I can say about our F-Type test car, and the Toyota Prius Uber that I took to the event.

Jaguar’s special autocross course, though small and dangerously close to the aforementioned One Direction concert, was enough to put the XE through its paces and get an approximation of what it’s like to drive the car in anger. Jaguar clocks the R-Sport’s zero-to-60 sprint at 5.1 seconds, and we’d say that’s probably accurate. It won’t roast a BMW M3, but it’ll sure put a smile on your face. The 340-horsepower supercharged 3.0-liter V6 is an absolute gem, and growls like Jaguar’s finest when pushed. Steering is tight and precise, and while the tires chirped when you really wanted them to, the XE is a car that probably makes you feel like a much better driver than you really are. For most drivers out there (including us), that really isn’t a bad thing.

Unfortunately, we didn’t get as much wheel time in the XE as we would’ve wanted to, but the end of the drive wasn’t a disappointment either. Unlike at the L.A. Auto Show, where the company’s new F-Pace was positioned above the crowd, Jaguar had one on site to pour over, and it was everything we hoped it would be — at least standing still. Talk about all-new, the F-Pace was so new that not even the product specialists on hand had taken one out yet. Frankly, we can’t wait to put one through its paces and see how it stacks up against our so-far favorite, the Volvo XC90.

Much has been made about the amount of development that has gone into the F-Pace, and while the luxury SUV segment is exploding, a successful XE would give the brand the one-two punch it needs to enter the premium car conversation once and for all. Jaguar’s new EliteCare five year/60,000 mile warranty should do wonders to dispel the decades-old reliability issues, and the F-Pace’s $40,000 base price, and XE’s $34,900 entrance fee (our test car would likely top $45,000) will make Jags more accessible than they have been in years.

Over 15 years have passed since the embarrassment that was the X-Type, and it looks like Jaguar has figured out how to do entry-level once and for all. But it’s a fact that Jaguar will never sell as many XJs as Mercedes sells S-Classes, and the XF will probably never reach sales parity with the BMW 5 Series. But really that’s a good thing — because among all the middle managers, executives, and bankers who studiously blend in with their German sedans, Jaguars and their owners have always stood out. There’s a level of old-world opulence, sporting pedigree, and yes, rakishness to a Jag that its competitors just can’t match, and the company is betting that in 2016 there are a lot of people out there who are ready for the full Jaguar experience without the headaches that plagued owners in the past.

On top of the XJ looks, F-Type interior, and old-school bark of its V6, the XE R-Sport offers everything you’d want from a Jaguar, and nothing you don’t. If the XE and F-Pace catch on, Jaguar could do the impossible and enter the mass-market luxury conversation on its own terms, not the Germans’. For other brands playing catch-up like Lexus and Cadillac, it may soon be time to stop following the Germans, and start watching the Brits.

Like classics? It’s always Throwback Thursday somewhere.

Follow Derek on Twitter @CS_DerekS