Jaguar's last compact sedan, the Ford-derived X-Type, left luxury buyers seriously unimpressed. Jaguar hopes its new car will do better. Photo credit: Jaguar Cars

Ever since India's Tata Motors (NYSE:TTM) bought Jaguar and Land Rover from Ford (NYSE:F) in 2008, one big question has been asked: Would Tata be willing (and able) to make the big investments needed to make Jaguar a competitive global luxury brand?

One part of that is being answered now, as Jaguar says it has the go-ahead to produce a much-needed new model, a compact luxury sedan to rival BMW's (OTC:BAMXF) 3-Series. In this video, Fool.com contributor John Rosevear explains why the new baby Jag is so important to the company's chances -- and fills you in on when we can expect to see the new car hit dealers.