If i understand the numbers correctly then this tire should work but be a lower profile correct?

195/40/zr16.

 

sure it would fit, but your speedometer would be off. when it reads 60 mph, you will actually be going 52.7 mph.
you will run up to the 36,000 mile warranty pretty fast with those tires.

 

What is it about that tire size that I am not getting then? Why would it effect the speed and milage that way? My brother in law put on some 17's on his xb and put on low profile tires. THat situation caused no adverse effects for him what am I missing here?

 

to keep the speedometer true with 17" rims, you need low profile tires to keep the circumference equal to the 16" rims.
your plan is to use 16" rims with low profile tires. what you're going to end up doing is making your car look like it's on go cart tires. the secret to up sizing is to keep the circumference equal to the original tires so the speedometer reads true. low profile only works with larger rims... not equal size rims.