All-new for 2006, the A3 hatchback slips into Audi’s line-up as the company’s smallest four-door, and the least expensive of any Audi model.

Sharing its basic platform with the 2006 Golf, the A3 is powered solely by a 2.0-litre turbocharged four-cylinder, although a 3.2-litre V6 should be arriving in calendar year 2006. Quattro all-wheel-drive is also in the future; for now, the A3 is strictly front-wheel drive. Transmission choices are a six-speed manual or Audi’s optional all-new Direct Shift Gearbox (DSG), also used on the Audi TT. This revolutionary new automatic transmission uses dual clutches instead of a torque converter, for almost instantaneous gear shifts. Its manual mode can be controlled by steering wheel-mounted paddles.

The 2.0T includes four-wheel disc brakes with ABS, 17-inch five-spoke cast alloy wheels, automatic climate control, power windows, cruise, power locks with keyless remote, cloth seats, floor mats, CD player with ten speakers, and first-aid kit.

The Sport package adds sport suspension, 17-inch, 16-spoke bi-colour alloy wheels, aluminum sill trim, roof spoiler, fog lights, leather sport seats, leather shifter knob and parking brake handle, and three-spoke multifunction leather-wrapped wheel.

The Premium package includes 17-inch, 16-spoke silver wheels, fog lights, leather seats with power driver’s adjust, HomeLink garage door opener, auto-dimming interior mirror, rain sensor, leather shift knob and parking brake handle, and three-spoke multifunction leather-wrapped wheel.

Available options include a “Cold Weather” package of heated seats, nozzles and mirrors, plus a ski sack; a six-CD Bose stereo; an “Open Sky System” two-panel sunroof; navigation system; and Xenon headlamps.

Although it’s a compact car, the A3 is all Audi: incredibly well put together, thoughtfully designed, and with superior driving dynamics. The 2.0-litre is extremely quick, with virtually no turbo lag; the DSG automatic transmission delivers crisp shifts without hesitation. On the down side, the climate control system is frustratingly complicated and non-intuitive, and it can be difficult to find the right position with the manual driver’s seat. Perhaps the biggest challenge the A3 faces is getting Canadians to accept its relatively high price-tag; those used to getting a large package for their money may balk at paying more than $30,000 for a compact car. Still, it’s quality over quantity; this little hatchback is one very sweet ride.

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