General Motors has declared war on the Germans.

At the unveiling of the Cadillac ATS compact sports sedan in Detroit on Sunday night, GM North America President Mark Reuss made no bones about the fact that the car was intended to be not just as good as, but superior to the competition from Audi, BMW and Mercedes-Benz.

Looking something like a shrunken head version of the company’s popular CTS midsize sedan, the ATS boasts a rear-wheel-drive chassis that Cadillac says is at least 100 pounds lighter than anything else in the segment, thanks to a weight-reduction program that optimized every part on the car.

When it goes on sale this summer, the CTS will also be available with all-wheel-drive and a choice of three engines, including the brand’s first four-cylinder motors since the ill-fated Cimarron of the 1980’s.

The base engine will be a 200 hp 2.5-liter four-cylinder, while more performance-minded buyers will be able to choose from a 270 hp turbocharged 2.0-liter four-cylinder or a 320 hp 3.6-liter V6. All can be had with six-speed manual or automatic transmissions, and one of them – not specified – will deliver more than 30 mpg highway, making it the most fuel efficient Cadillac ever.

To endow the ATS with the type of handling characteristics associated with the BMW 3-Series, Mercedes-Benz C-Class and Audi A4, Cadillac brought it to Germany for development on the demanding Nurburgring racing circuit, a more than 13-mile track popular as a proving ground for the world’s best performance cars. An advanced active suspension featuring magnetorheological shock absorbers that is shared with the $100G Corvette ZR1 and CTS-V lineup will be an option.

The interior of the ATS is trimmed with high-quality materials and features an updated version of Cadillac’s signature design language, along with its new CUE (Cadillac User Experience) infotaintment system, which is controlled by a capacitive touchscreen interface like those found on today’s smartphones and tablets.

Pricing for the ATS has not been revealed, but is expected to undercut its rivals by a significant margin, as does the CTS in the midsize segment.

And just to put an exclamation point on how serious Cadillac is about taking on the Germans at their own game, Reuss announced that the ATS would be available with a diesel engine during its first generation, but did not specify if or when it would be sold in the United States.

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