Audi is arguably the most understated of the premium German brands, so it should come as no surprise that improvements made to the coming A3 are discreet, despite plenty of technical upgrades hiding beneath. While <a href="https://www.thenationalnews.com/tags/suv/" target="_blank">SUVs </a>continue to rule the sales charts, <a href="https://www.thenationalnews.com/tags/audi/" target="_blank">Audi’s </a>diminutive A3 remains a crucial model providing not only an entry to the company’s saloon range but also, as it creeps up in equipment levels, a starting point to prestige German motoring. This fourth<b> </b>generation A3 features a more powerful turbocharged, four-cylinder engine in the flagship S3 with 328bhp and 420Nm of torque, combined with a new torque-splitting rear diff from the RS3 and improved steering. Visually it’s best recognised by its new 24-pixel, digital daytime Matrix LED headlights, which lets the driver choose from up to four light signatures across the front. This A3 introduces a new badge via the Allstreet variant, which offers a rugged-looking design with 30mm more ground clearance and a chiselled look from its faux off-road skid plate and roof rails. Sadly, it’s not coming to the regional market. By way of compensation, the Middle East will get the updated S3 with its extra 23bhp and 20Nm of torque over the old model from its two-litre, TFSI, turbocharged engine, along with a tweaked design comprising a sporty front diffuser and quad exhausts. The S3 accelerates from 0 to 100kph in 4.7 seconds with peak torque available from 2,100 to 5,500rpm and has a top speed of 250kph. Pricing for the UAE will be announced at the end of the year. However, in Europe, the A3 starts at €35,650 (Dh139,229) for the five-door Sportback, €36,450 (Dh142,425) for the sedan and €55,600 (Dh217,284) for the S3. Inside, a smaller shift lever along with redesigned air vents, a three-spoke leather steering wheel, new fabric inlays and updated interior lighting greets you as part of the standard package. A 10.1-inch touch display screen, inductive smartphone charger, two front USB-C charging ports in the centre console plus two ports in the rear are all standard, while the options list includes Navigation Plus and access to Audi’s app store. On the road, the S3 is the most dynamic model in the range and is a stunner on winding back roads. Its wide torque band ensures there’s always power under foot for exiting tight corners or spotting a sudden overtaking opportunity. My drive in the A3 takes me through the forests outside of Munich on a rainy day, which proves to be perfect for the all-wheel drive and its torque splitter, twin-clutch differential. This gives it an almost, rear-wheel steering feel as it arrests torque from the outside rear wheel to tighten up its turning radius for corners. The system first appeared on the previous generation RS3 and has now been updated and installed on the cheaper S3. The A3’s adaptive cruise control assists with both longitudinal and lateral control as it handles acceleration, braking and steering at up to 210kph. It’s supplemented by an assisted lane change function that operates above 90kph on highways. Tap the turn signal and the system actively assists the driver in steering into the next lane and also checks the surroundings to make sure it’s safe to do so. During city driving, its park assist helps park and reverse out of tight spaces using the same sensors. All very clever technical devices, however, the lane assistance system feels too keen to steer the car for me, to the point of being intrusive, as it reads old white line markings that have been painted over and are bleeding through to the surface in the damp conditions. The regular Audi A3 Sedan and Sportback 35 TFSI with their 148bhp, 1.5-litre mild hybrid engines are backed by a seven-speed auto and while the sedan test car is obviously more lethargic compared to the S3, it feels no less capable as a quality luxury compact. Its tall gearing devours long distances on the motorway, maintaining high speeds while not bothering the petrol gauge. Audi claims it returns between 5.8 and 6.1 litres per 100kms. The newest Audi A3 has climbed deeper into the premium compact segment offering quality features with a price to match, but in doing so, also delivers a near complete solution of comfort, performance, great handling from its improved steering and the clever diff borrowed from the RS3. It’s a brilliant case study for subtle refinements over wholesale makeovers.