One version of General Motors‘ new Seville-replacing 2005 Cadillac STS sedan will be subject to the US ‘gas guzzler’ tax because of its poor fuel economy.

Reuters said the STS sedan, which goes on sale late this year, is one of a growing number of sporty luxury cars that forsake fuel economy for more speed and prestige.

When fitted with the optional 4.6-litre V8 engine and four-wheel drive, the STS will average about 20.9 miles per gallon, making it subject to a federal gas guzzler tax of about $1,000 to $1,200 at the time of sale, Jim Federico, GM’s chief engineer of prestige vehicles, told the news agency, which noted that other carmakers routinely offering gas guzzlers in the US include BMW, Jaguar and Mercedes.

But officials reportedly said GM had an internal rule against building gas guzzlers until it decided it needed to compete and launched the Pontiac GTO sports coupe last year.

Mark LaNeve, general manager of the Cadillac brand, told Reuters the 4.6-litre V8 model will account for about 5% to 10% of the 30,000 STS models that Cadillac expects to sell annually – GM will also offer rear-wheel drive only models and versions using a 3.6-litre V6.

The news agency noted that, despite rising petrol prices, and growing demand for more fuel-efficient vehicles such as hybrids, a sizable portion of US consumers want high performance vehicles so carmakers have responded with bigger engines with more horsepower.

“There’s a lot of popularity for V8 engines,” Tom Libby, director of industry analysis for the Power Information Network, told Reuters, adding: “There’s been no real sensitivity to gas prices.”

GM’s vehicle line executive of prestige vehicles, Jim Taylor, told the news agency his company had had some internal debate about whether it wanted to sell a gas guzzler, but decided it had to compete with other carmakers that readily paid the tax.

“We’re trying to get our performance credentials back,” Taylor reportedly said, adding: “Luxury customers just expect a certain amount of performance.”