The 2012 Volkswagen Touareg TDI is a fine $52,355 luxury SUV that raises the question: Why on Earth is Volkswagen selling a $52,355 SUV?
That's less of a head-scratcher in Europe than America. Many Europeans _ especially Germans _ think of VW as a premium brand, a clear step up from the likes of Chevrolet, Ford, Honda, Hyundai and Toyota.
By contrast, most Americans expect Volkswagens to be inexpensive, if not downright cheap. That's why the company just introduced less-expensive versions of its Jetta and Passat sedans here.
The Touareg team at VW headquarters in Germany must not have gotten the memo about cutting costs, slashing prices and competing with Chevy, Ford, Honda and Toyota. The diesel Touareg TDI Lux I tested was clearly developed, built and equipped to compete with luxury SUVs like the BMW X3, Cadillac SRX, Infiniti FX, Lexus RX, Lincoln MKX and Mercedes-Benz ML.
The Touareg is a very nice vehicle, but pitting the VW badge against the BMW roundel, Cadillac wreath and crest or Mercedes star is bringing a knife to a gunfight.
Moreover, VW already has a luxury brand: Audi. The Q5 is a terrific small luxury SUV. It'd be even better with the Touareg TDI's powerful and fuel-efficient 3.0-liter V-6 diesel.
Despite that, the Touareg TDI has some strong selling points. Its 7,710-pound towing capacity is more than double what the X3, SRX, Terrain, FX, RX and MKX offer.
The Touareg has more passenger and cargo space than the Audi, BMW, Cadillac, GMC and Infiniti. Its EPA fuel economy rating of 19 mpg in the city, 28 on the highway and 22 in combined driving beats all but the Mercedes ML350 Bluetec diesel.
If you can get your head around paying Mercedes-level money for a Volkswagen, there's plenty to like about the Touareg TDI: fuel economy, looks, interior fit and finish, and handling.
The 2012 Touareg is all new. It's lighter and sportier than its predecessor, which was VW's first real SUV. For the second generation, VW dispensed with the gear required for extreme off-roading. The Touareg shed up to 350 pounds, depending on the model.
The 2012 Touareg is bigger and has more interior room than its predecessor. All Touaregs have full-time all-wheel drive.
Prices for the 2012 Touareg start at $43,375 for a base model with a 280-horsepower 3.6-liter V-6 and eight-speed automatic transmission.
Diesel models have a turbocharged 225-horsepower 3.0-liter V-6 and the same gearbox. Prices start at $46,875.
VW also is offering a hybrid Touareg for the first time. It has a 380-horsepower powertrain that combines a 3.0-liter supercharged V-6, nickel-metal hydride batteries and an electric motor.
The hybrid system is essentially the one in the Porsche Panamera luxury car and Cayenne SUV. Porsche developed the hybrid system for itself, VW and Audi. That helps explain the Touareg hybrid's eye-watering $61,110 base price. All prices exclude destination charges.
I tested a Touareg TDI Lux that cost $52,355. Its features included a touch screen to control the navigation, audio and other systems and good voice-recognition for Bluetooth hands-free phones. It lacked blind spot alert and a backup camera, features you might expect above $50,000.
The Touareg has a wide stance and sleek profile. The new model's longer wheelbase provides good legroom and a useful 32.1 cubic feet of luggage space behind the rear seat. The interior is quiet and trimmed in attractive materials.
The electrically assisted power steering is precise and provides good feedback. The suspension cushions rough surfaces and holds the Touareg secure on winding roads. The SUV is maneuverable and fun to drive, though less sporty than the X3 or Q5.
The turbodiesel generates 406 pound-feet of torque from just 1,750 rpm for prompt acceleration. The diesel is only slightly louder than a gasoline engine. The eight-speed automatic transmission shifts quickly and smoothly.
The 2012 is a huge improvement from its overweight, over-priced predecessor, and an able competitor to several midsize luxury SUVs.
Whether that makes it an under-the-radar stealth fighter or the right product from the wrong brand may depend on what you think the VW badge is worth.
JUST THE FACTS
VOLKSWAGEN TOUAREG TDI LUX:
All-wheel drive five-passenger SUV
Base price: Gasoline, $43,375; diesel, $46,875; hybrid, $61,110
Price as tested, diesel: $52,355 (excluding destination charge)
Rating: Three out of four stars
Reasons to buy: Fuel economy, styling, handling
Shortcomings: Price, lack of common features, hands-free phone audio