2006 Audi A3

Audi's new-for-2006 A3 compact sportwagon posed three questions: How successfully could this premium German brand descend the vehicular food chain without downgrading its brand image? How good was the VW Group's new 2.0-liter turbocharged four-cylinder direct-injection powerplant? And what would it be like living with its innovative Direct Shift Gearbox (DSG)? The answers proved to be pretty good-and above all expectations.

VW/Audi's old 1.8-liter turbo four was tough and put out good power on boost, but it was peaky and short on torque. The new 2.0, with more displacement and a sophisticated direct fuel-injection system, delivers more power over a much wider rev range, curing both of the 1.8's problems. Most auto-clutch manuals tend toward the jerky side, but the DSG's innovative gearset and clutch design suffers no such drama. Pull the upshift paddle, and the next gear hits quickly and cleanly; when hard on the gas, the shifts are accompanied by a race-car-like burp from the exhaust. Downshifts are rev-matched and butter smooth.

We put several people behind the wheel, asked them to select the Drive (fully automatic) mode, pedal about, and tell us what kind of trans the A3 employed. All but one was sure it was a conventional automatic. It's that good, and became just one aspect staffers most enjoyed about our year with this car.

The A3 also drew high praise for its exterior design; everyone seems to have gotten comfy with Audi's horseshoe-shaped grille, and the fastback roof and tapering window line make it as handsome a station wagon as you'll find. "Such a great package" commented one editor. "Easy to maneuver and park. Room for five. Good cargo space (I like the cargo nets, too). And fun to drive." The last was a comment written many times into the logbook. No lie: The A3 is quick, relatively quiet, and rides nicely for a car that grips and handles so well.