Audi could have been a little more daring with the third generation A4, but that won't stop it challenging for outright leadership of the compact executive class. It's a little larger and slightly sportier than before, plus a strong engine range is retained and improved. Sure, you'll pay a premium to own one - but you'll feel good about doing it.

The importance of the A4 can't be stated to heavily for Audi. This, after all, was the car that made its marque back at its original launch in 1995 and the Ingolstadt brand hasn't looked back since, now regularly out-selling its BMW and Mercedes rivals here. It's a success story that won't continue if the company gets its foundational model wrong. If you didn't already know that, then you could probably guess the fact by looking at the latest third generation model, a car that is firmly evolutionary rather than revolutionary. Mind you, evolution seems to work for Audi. People will buy this A4, just as they bought its predecessor, precisely because it doesn't have the love-it-or-hate-it Marmite-style looks of a BMW 3 Series. Mercedes latest C-Class however, might prove to be a tougher nut to crack.

So what's new from a driver's point of view? It had better be good since Audi are positioning this car as "the sportiest in the premium sector". For the time being on the British market, the company talks of "five new or extensively revised engines", including two directly injected FSI petrol units and three common rail directly injected TDI diesels. To be absolutely honest, there's much more emphasis on 'extensively revised' than 'new', which would be more of a problem if the carry-over technology from the second generation A4 wasn't as good as it is.

Shiny new oily bits under the bonnet are all very well but rightly, the engineers thought it better to spend the budget they had on things customers would be more likely to notice on that first trip round the block. The headlines in this regard are a new sports chassis with a repositioned front axle, all new steering and (on 3.0 TDI and 3.2 FSI variants) a latest generation quattro system with 40:60 torque split. If you've money to spend on the options list, you can also benefit from 'Audi Drive Select', enabling tailoring of throttle, steering and suspension characteristics to suit driver preferences

"Audi are positioning this car as "the sportiest in the premium sector" ?"

The other headline feature of this latest A4 is the fact that it sits on the longest wheelbase in its class. Audi took action to try and solve the appallingly small bootspace problem suffered by the MK1 A4 when it came to launching the second generation car at the turn of the century and here, they've turned their attention (at last) to the poor old rear seat passengers. The lengthened wheel base enables a 36mm increase in rear leg room, with the added bonus of a 20-litre boost in boot capacity, making this car easily the most spacious in its sector. This in turn means that buyers now no longer have to choose between the prestigious badge and low residuals of a compact executive car like the A4 or the larger cabin of a cheaper Medium range model like, say, Ford's Mondeo or Volkswagen's Passat. Since these kinds of cars are now dynamically as good as most C-Class, 3 Series or A4 models, that's just as well.

Audi would argue with this of course, pointing out that the wheelbase change was about promoting the A4 as a driver's car as well as improving its cabin space. It entailed the repositioning of the front axle 154mm further forwards than in the MK2 model. Complemented by a new state-of-the-art suspension and steering configuration, this more stable foundation allows improved handling balance and agility. It doesn't make this Audi better than a BMW 3 Series through a set of testing twisties (only rear wheel drive would do that), but it does lift it clear of its Mercedes rival in this respect.

Petrol buyers choose either the turbocharged 1.8 TFSI with either 120PS as a manual or 160PS as a Multitronic automatic. Otherwise, it's the normally aspirated but silky-smooth V6 3.2 FSI with 265PS. Most customers however, will want a diesel, so there's the familiar choice of 2.0 TDI (143PS), 2.7 TDI (190PS) and 3.0 TDI (240PS). If you want automatic transmission on your A4 diesel, you'll need to go for the 2.7 which gets Audi's efficient multitronic continuously variable (CVT) 'box. Otherwise, you'll find yourself with a six-speed manual.

Prices start at £19,890 for the entry-level 1.8 TFSI, sharply rising to £29,680 for the 3.2 FSI Quattro (a gap Audi needs to fill quickly). Diesel buyers pay from £23,940 for the 2.0 TDI, with £28,440 being the asking price for the auto-only 2.7 TDI. Above that sits the 3.0 TDI quattro at £30,290. There are standard, SE and S line trim levels and all models get a decent level of kit that runs to 16-inch alloy wheels, an 80-watt audio system with single CD drive and 6.5-inch display, electronic climate control, front and rear electric windows and a split/fold rear seat.

If you don't care about the bonnet badge, it's tempting to think that you could save £4,000 or so on a mechanically very similar Volkswagen Passat but before you do, make sure to take residual values into account. Add all the figures up at the end of the day and you may well find that there's less in it than you thought.

Insurance costs are very little changed (expect to find your model of choice pitched somewhere between groups 12 to 15) as are fuel consumption figures. The 2.0 TDI that most will choose manages a creditable 51.4mpg on the combined cycle, while even the 1.8 TFSI is up around the 40mpg mark. Expect to see a little more in terms of change when it comes to residuals. The MK2 A4 was beginning to feel rather an old car, with residuals starting to wane. The MK3 model should pick things up in this regard, more than compensating for its pricing premium.

For every buyer who wishes that Audi had been a little more daring in the design of this third generation A4, there will probably be three more who like the car just as it is. You can hardly therefore, really blame the designers for their rather careful efforts.

The Audi Drive Select System is a good idea, though it's a pity it's a pricey option. Still, fortunately, you don't need it to appreciate the improvements that Audi have made to this car on the road. Thanks to the sports chassis, the driver who can appreciate the slender lead that BMW still enjoys in terms of driving dynamics is rare indeed, while many more will appreciate the Audi's advantages in cabin space, value and the option of four-wheel drive. A Mercedes C-Class runs the A4 close but, model for model, costs significantly more. Which could be critical for Audi when it comes to the fight for class leadership.

TOP 5 A4 DEALS

The results below show the top A4 deals on buyacar

	Audi A4 2.0 TDi 143 SE 4dr Saloon
	ETR	Mthly £352	Saving £1,960	Price £21,635
	Audi A4 1.8T FSi 160 SE 4dr Saloon
	ETR	Mthly £341	Saving £1,820	Price £20,425
	Audi A4 2.0 TDI 143 SE 4dr Mulitronic Saloon
	ETR	Mthly £374	Saving £2,105	Price £22,965
	Audi A4 1.8T FSI 160 SE 4dr Multitronic Saloon
	ETR	Mthly £363	Saving £1,965	Price £21,730
	Audi A4 2.7 TDi SE 4dr Multitronic Saloon
	ETR	Mthly £437	Saving £2,405	Price £25,690

typical 10.00% APR

PCP finance quote over 48 months,  10,000 miles pa,  deposit of £1000