Apple is working closely with a range of car manufacturers to develop iPod interfaces for future vehicles.

The company seems presently linked with Volkswagen and Jaguar. In addition to its work with these firms, iPod/Auto integration appears critical in today's highly-competitive vehicle market, with Toyota, Citroen and Lamborghini all recently announcing iPod support in new model cars.

That Apple is in communication with car makers is nothing new. Apple and Mercedes-Benz unveiled the first integrated iPod connection kit as long ago as January 2005. But recent reports confirm that integration of the media player continues to gather steam as iPod's market dominance prevails.

Jaguar's new XF is one of the most important vehicle releases the company has ever made, according to the company's head of design, Ian Callum.

Callum told Car Magazine: "At the risk of sounding immodest, it’s the most important new car for us since the 1968 XJ6." He also confirmed the company has been working with the iPod maker: "We have been working with Apple on control interfaces," he said.

The central console of the new Jaguar doesn't have a gear stick, but a control knob (the Drive Selecter). It also offers a portable audio interface for the iPod.

In use the interface is touchscreen controlled using the vehicle's installed system: "In a world first, full Touch-screen control of the iPod allows access to Playlists and Music search by Artist, Album or Genre," Jaguar said of the control.

Apple is in even closer discussion with Volkswagen. The two firms are discussing the notion of building an iCar in a link that has seen the CEOs of both firms meet to discuss the proposition.

The Volkswagen iCar may be equipped with a Mac, along with iPod integration. Volkswagen spokesman Hans-Gerd Bode told Associated Press that there are many ideas, but "few" concrete plans at present.