For 2007, the Volkswagen Rabbit is an all-new model, of sorts: it’s the next-generation of the model known as the Golf elsewhere in the world, a name Volkswagen used in North America from 1985 on. But the company has returned to the “retro” name under which it first introduced this hatchback to our shores. As with the Golf, the performance GTI version also returns, based on the new model.

The new Rabbit features a more powerful engine, new independent multi-link rear suspension, better handling, stiffer body and, unusual at this price, a Bosch electro-mechanical variable-assist rack and pinion setup with an “active steering” feature that compensates for lateral forces, such as a gust of wind on the highway that might otherwise knock it off course. Production also returns to Germany, instead of the Brazil facility where the Golf was manufactured.

The Rabbit is available in two- or four-door configuration (the company calls it three- and five-door); all use a 2.5-litre five-cylinder engine, mated to a five-speed manual or optional six-speed automatic with Tiptronic manual mode. The diesel engine formerly available on the Golf has been temporarily discontinued on the Rabbit line for 2007, but is expected to return in 2008.

The GTI uses a 2.0-litre four-cylinder with a turbocharger; it’s mated to a six-speed manual, or optional six-speed direct shift gearbox (DSG) automatic, which uses dual clutches for instantaneous shifts.

Features on the two-door Rabbit include 15-inch steel wheels, heated mirrors, variable intermittent wipers, air conditioning, anti-theft alarm, cruise control, power locks with keyless entry, CD stereo, side and curtain airbags, six-way manually-adjustable driver’s seat, “easy-entry” rear seat system, cloth seats, 60/40 folding rear seat, tilt and telescopic wheel, and power windows.

The four-door Rabbit adds body-colour mouldings, eight-way manually-adjustable driver’s seat with power recline, rear centre armrest and pass-through, and velour seat fabric.

Available options include rear-seat side airbags (on the four-door), electronic stability control (at a reasonable $450), cold weather package (including heated seats) and alloy wheels.

Features on the GTI are similar to the Rabbit, with the addition of 17-inch alloy wheels, Xenon headlamps with washers, rear spoiler, single-zone climate control, sport seats, six-CD stereo, heated seats, and with the DSG transmission, wheel-mounted paddles.

The Rabbit is a well-done makeover, improving on a model that already had good handling; the new model corners even sharper, the five-speed is fun to drive, and the six-speed is very smooth. The Rabbit’s low-end torque is well suited to city driving, where it isn’t necessary to be constantly shifting, and there’s plenty of power when needed on the highway. Its five-cylinder engine is stronger than many of the four-cylinders employed by its competitors, but its fuel consumption is slightly higher; still, you’ve got to pay for that power somewhere, and this is one great little bunny when you’re behind the wheel.

The GTI builds on that, turning out a model that, for the first time in a long while, is truly worthy of the name. There’s no turbo lag, the steering is accurate, both the six-speed and the DSG are perfect, the seats are supportive and the driving experience is just plain fun.

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