wallabytoo:If VW (or anyone else) can genuinely create a petrol engine of 200 plus hp (as per Golf MK VI GTI) that can manage anywhere near 40mpg, I would perhaps agree with your argument.
Audi have already launched this engine in the A4 and A5. In the A4 saloon this engine is claimed to acheive 0-60 in 6.9s, with combined economy of 43 mpg and 154 g/km CO2. If this was put in a Golf, it would surely be 45+ mpg and slightly faster again.
Obviously it remains to be seen how real life consumption compares to these figures, however I have driven the Seat Leon FR (same engine as your TT) and managed to get average consumption very close to the claimed figures. On rural driving routes it would do high 30s mpg. Same with my own MX-5, where I regularly get close to 40 mpg commuting to work.
I think more people could achieve the claimed mpg if they drove a bit more sensibly. By this I don't mean you can't have fun and put the foot down, but you don't have to accelerate all the way to an obvious obstacle (like lights or a tight bend) then slam on the brakes and repeat this process the whole journey. That wastes a huge amount of fuel and really doesn't get you there much quicker, if at all.