The most popular engine in the new A3 range will be the 148bhp 2.0-litre TDI, Audi says. This model will take on the BMW 118d and Mercedes A200 CDI and make up 40 per cent of sales.

Although the engine has the same l,968cc capacity as the one it replaces, it’s entirely new. There’s now 10bhp more, plus stop-start and a revised turbo, which helps with efficiency and improves the spread of torque across the rev range.

The mid-range A3 Sport we tested sits on optional 18-inch alloys (£595), instead of the standard 17-inch wheels. The Sport also gets a lower front bumper and integrated foglamps over the entry level SE.

The luxurious cabin’s quality is class-leading, as is the technology inside it. Highlights include a standard 5.8-inch display (which rises from the dash and is paper-thin), a lower driving position, and what Audi calls a “lean and low” dash, with high-end textured materials.

The optional part-leather seats are firm but supportive, while the door trims and surfaces are impeccably finished. The one exception is the dash top, which is a bit on the hard side, but you’ll rarely come into contact with it. Gadget fans will love the standard dual-zone climate control, Bluetooth and iPhone connectivity, as well as the handwriting recognition pad that’s integrated neatly into the iDrive-style MMI control knob.

Audi A3 2.0 TDI Sport

Audi A3 2.0 TDI Sport

The A3 impresses on the road, although it doesn’t represent a big step forward over the old car. The new MQB platform allows the engine to be mounted lower, cuts weight by up to 80kg and means a longerwheelbasewith short overhangs, all of which is great for dynamics. But this is spoiled by our Sport model’s large wheels and stiffer springs, which have implications for the ride comfort.

On the motorway, you can feel even tiny surface changes, making the car feel jiggly. Even in the Drive Select’s Comfort mode, it’s not particularly pliant. But if you stick with 17-inch wheels and standard springs instead of sports suspension (a no-cost option), then things improve considerably.

Audi A3 2.0 TDI Sport

Audi A3 2.0 TDI Sport

On the plus side, the wider tyres provide loads of grip and, combined with a substantial 320Nm of torque, make the A3 a quick point-to-point car. Push the engine hard and the gruff diesel idle note quickly fades, replaced by a smoother sound and progressive power delivery. It’s also beautifully refined at motorway speeds.

The six-speed manual gearshift is quite light, but the changes are slick. The steering is also light, although it has better feel than in the old A3.

This 2.0 TDI beats its rivals from BMW and Mercedes on efficiency, with 68.9mpg and 106g/km of CO2. Plus the A3 has earned a five-star Euro NCAP safety rating.

Audi A3 2.0 TDI Sport

Audi A3 2.0 TDI Sport

Audi leads the way for interiors, and the new A3 is no exception. Quality materials and cutting-edge technology send the car straight to the top of the class.

Be careful when you order your A3. The combination of sports suspension – which drops the car by 15mm – and 18-inch alloys looks great, but the ride will be too uncomfortable for some people.

Audi A3 2.0 TDI Sport Interior

Audi A3 2.0 TDI Sport Interior

Verdict

The Audi A3 is superbly built, drives well and has made a lot of progress in terms of weight reduction, which has knock-on benefits for fuel economy and running costs. Alongside the Mercedes A-Class and Volvo V40, its understated looks seem a bit bland and it’s no firecracker to drive, but there’s no denying its sheer quality and sophistication.