One of the leading lights in our premium compact luxury hatch market is the Audi A3, with the latest iteration of this best seller, yet another A+ plus effort from Audi.

Sharing the same platform and mechanics as its sister car the new 7th generation Volkswagen Golf, gave Audi a great base to create a great car. They have seized that opportunity and produced what is probably the finest Audi badged hatchback yet and arguably the best in its class. Ironically its biggest challenger for that title comes from within Volkswagen-Audi family in the form of the formidable new Volkswagen Golf GTi.

The A3 has developed into one of Audi sales stars, since the company first lobbed their hat into the small luxury hatch ring 15 years ago. This is an aspirational model and priced accordingly with the entry-level 1.4 litre turbo costing $48,400. Most buyers are expected to sign on for the Sport with the choice of a 1.4 turbo or a larger and more menacing 1.8 turbo. Both models are priced at $51,900 and $55,400 respectively. For the economy minded a 2.0 litre turbo diesel is on the books as well for $55,400. It was a 1.8 turbo that made the cut for this road test and it came loaded with $8,500 worth of options, pushing its price alarmingly close to $64,000. Regardless of the status of the nameplate, this is a pretty big number for any small five-door hatch. Like many European brands, if you tick to many boxes on the options list the dollars quickly mount up. A number of the options such as a backing camera, parking sensors and satellite navigation, should for a car in the price bracket should be standard, not a tick box item in the extras menu.

A new generation 1.8 litre 132kw turbo motor also found in some versions of the latest Skoda Octavia, delivers all the performance punch and panache expected from a vehicle sporting the coveted Audi badge. Like its cousin the Golf, fuel economy and performance both benefit from a weight reduction of around 100kg over the old model. The upshot is a car with an excellent power-to-weight ratio. This manifests itself in every day driving by delivering consistent levels of smoothness, refinement, along with irrepressible energy levels. The test car glided along effortlessly at open road speeds, with the ease you would associate with a much larger car, yet mustered in an instant, the acceleration needed to safely scoot past slower moving traffic.

Like the Golf I drove earlier this year, the test car displayed the same slight hesitancy under full throttle, causing a micro second pause between the driver flooring the throttle and the engine bursting into action. This less than seamless power delivery was little bit disappointing from what should have been a new and improved engine. It was also out of character for a motor that otherwise delivered in full measure and more on all most every other front.

An intelligent and intuitiative 7-speed tiptronic auto differs from most other automatics in using a two clutches. One is assigned to changing evenly numbered gears, the other focuses on the odd digit gears. It all sounds a bit odd, but it is hard hard to argue with the quick and accurate gear changes it produces . The transmission uses Audi’s Drive Select system featuring sport, comfort and efficiency mode. This latter mode is about reducing fuel econsumption. Sport provides the fun factor by adding an even more aggressive edge to the engines performance. The gear changes are occur sooner and the engines is allowed to run closer to it 6,500 rpm redline in stark contrast to the efficiency mode that dives into a higher gear at the earliest opportunity.

One key area where the A3 differs from the new Golf is in cabin space. The Volkswagen’s passenger compartment felt larger in all directions. For some reasons, those attributes have not filtered across in the same measure to the A3. Head and leg room both front and rear is adequate and very much a middle of the pack effort compared to some models in this class. A modest rear cargo compartment appears to be designed more for bite sized, rather than chunky loads. This is something buyers may find a little hard to swallow buyers if the have above average load carrying carrying requirements.

While visually pleasant, it would have been nice if Audi could have broken their conservative shackels with this model and been a little bolder with the styling. I guess with the A3 being one of their top selling models and a key contributor to the company coffers, there was an understandable reluctance to go out on a styling limb, with a car that has been so darn successful for them.

A deftly tuned and exceptionally nimble four-link rear suspension kept the test car riveted to road, even those sporting fairly torturous surfaces intent on terminating your cars underpinnings. The A3’s rigid body structure does a great job over these sort of combative roads, without so much as a squeak, groan, or moan emanating from suspension or interior trim. Another major contributor to the cars outstanding drivability is it highly communicative steering with its almost instant response to the driver commands. In the quest for handling perfection, ride comfort hasn’t been trampled all over along the way. The suspension’s DNA still has enough suppleness, to ease the car fluently over brutal bumps and ruthless ruts, with the vehicle occupants hardly hearing or feeling a thing.

What is the verdict? Classy premium luxury hatch offering strong performance, fleet footed road holding and superb build quality, although the staid styling is less endearing.