The AJ-V8, also offered in 3.2-litre form (240 bhp) saw the killing-off of the XJ6 badge, and it also replaced the V12. Under the regime of the newly-formed Ford Premier Automotive Group (PAG), the range was slimmed-down and simplified, and the entry-level models discontinued; prices were raised accordingly to bring back the exclusive feel. Daimler versions continued, too, targeted even further upmarket, with the supercharged V8 badged as a 'Super V8' and aimed more against the Bentleys and Rollers than the M5s and fast Mercs. The new engine marked the return of class-leading refinement, too, and even if the XJ did feel a little dated in concept, it was still the most comfortable, smoothest-riding and quietest-running car of its type. Jaguar managed to load it up with all the latest technology, including computer-controlled active suspension, automatic stability control and traction control, and, later, dynamic cruise control, which can keep a pre-determined distance from the car in front. With the launch of the new 'entry-level' S-Type in 1998, and the subsequent advent of the 'baby' X-Type, Jaguar was able to position the XJ as the ultimate luxury model in its range and not worry about accessibility. All except the Sport models have had leather upholstery, as well as electronic climate control, fully electrically adjustable heated seats, and the electronic control systems. 1997 also saw the launch of the new five-speed electronically controlled gearbox, and shielded deadlocks to improve security.

The general improvements in Jaguar's build quality has meant that, despite the increasing trend to rapid depreciation of luxury cars, the X300-series XJs are popular secondhand buys these days. There are no major faults known with this range, but it would be very unwise to touch one without a full Jaguar service history. Used prices of this series are likely to become better value once the all-new range goes on sale.