Hyundai is developing a third generation of its Theta four-cylinder engine that the company says will work in mid-engine vehicles, fueling rumours the company has something fun up its sleeve.

The report originated in a Korean publication called Motorgraph, which says the new engine will displace 2.5L when it bows in the 2019 Genesis G80 and that there will also be a 2.3L variant to do duty in mid-engine applications.

A mid-engine Hyundai is not that crazy an idea, as the company demonstrated with a series of Veloster-based concepts build around a midship motor.

Motorgraph suggests that smaller motor could crank out 350 hp, as opposed to the 300 capable from its larger displacement counterpart. That raises the question of whether Hyundai, having successfully wedged its way into the luxury sedan segment with its Genesis brand, has its sights on cars like the Porsche 718 models.

The Theta III will also replace the turbo 2.0L Theta II that currently powers more mainstream models like the Sonata sedan and Santa Fe crossover, the latter set to arrive in Canadian showrooms by the fall.