Volkswagen’s latest step in its steady march away from the bare-bones, low-budget cars that made its reputation forty years ago takes it into the realm of sport-utility vehicles.  You might be surprised to find that the Volkswagen of SUVs is actually a luxury truck that competes more closely with BMW and Lincoln than with mass-market best-sellers like Ford and Chevy.

Then again, you might not.  After all, the new-for-2003 Volkswagen Touareg (say “tour-egg” and you’ve got it about right) is directly related to another SUV newcomer; the Porsche Cayenne.  It’s a latecomer to the extremely crowded and competitive sport-utility market, but the Touareg is bound to turn heads thanks to its powerful 4.2 liter V8, shared with Audi, and its combination of high luxury and serious off-road ability.  It’s got an impressive mix of luxury and performance equipment that’s making it the envy of some much more expensive vehicles.

The Touareg’s face owes a lot to the Volkswagen AAC concept truck shown a few years ago.  It’s a butched-up version of VW’s familiar square-but-round face, with a gently sloped nose and a gigantic VW logo riding front and center.  At the back, the Touareg is rounded like a Super-sized Golf, with another big VW badge and elegant detailing around the tailpipes.  It wasn’t particularly a standout in our eyes, but many onlookers disagreed, and we got questions at several fueling stops.  Volkswagen’s good at doing details, like the frameless windshield wipers and rear doors whose cutlines go all the way to the rocker panels, helping smooth out the Touareg’s sides.  Our test truck’s optional 19″ wheels necessitated a unique space-saver spare that is stored deflated, and inflated when needed with an on-board air compressor.

The luxurious interior shows that Volkswagen isn’t planning to compete head-on with mass-market mid-sizers like the Chevy TrailBlazer and Dodge Durango.  The Touareg is undeniably an upmarket truck, with a big T-shaped console that can contain a navigation system.  There’s seating for five, four-zone air conditioning, and enough soundproofing to ensure that the Touareg will seem calm even on the roughest of roads.  The seats are comfortable front and rear, and the controls and gauges have a pleasant quality feel to them.  Real wood trip is used.  The Touareg doesn’t feel cheap in any way.

Two engines are available; a 3.2 liter V6 making 220 horsepower, and a 4.2 liter V8 that cranks out 310 horses.  There is talk that Volkswagen will add a turbodiesel V10 to the lineup as well; that engine is already on sale in Europe.  Our test truck was a V8, and we were happy with its freeway and around-town performance.  A six-speed automatic transmission is standard, and has a hill-holding feature that prevents the Touareg from rolling downhill when starting on steep inclines.  The transmission helps keep the engine calm and quiet on the freeway.  Getting it to drop a gear can be a chore; it likes to keep the big V8 revving low as often as possible.  A Tiptronic” manual gear selection feature is borrowed from Porsche, but we found it to be somewhat lazy about shifting as well.  V8-powered Touaregs can tow over 7700 lb.

Volkswagen equips every Touareg with full-time 4XMOTION four-wheel drive.  All suspensions are fully independent, with double wishbones at all corners enough ground clearance to tiptoe over large obstacles.  Our test truck was equipped with the optional air suspension, which can be raised about three inches higher than the standard springs, or lowered for highway travel.  The Touareg is happy on the freeway, but the low-riding “Sport” setting on the air suspension makes for harder impacts than buyers of $40,000 vehicles will be used to.  On the normal setting, the Touareg is noticeably tippier than the competition from Lexus and Volvo at freeway speeds, but far from unstable.

Around town, the Touareg feels confident, but ponderous.  Rather than disguising its girth, the big V8′s power makes the Touareg seem larger.  Visibility is good in every direction except straight forward, where the sloped nose disappears somewhere in front and it’s hard to place the Touareg in a lane.  We couldn’t tell if the truck felt wider than it was, or was wider than it felt, but parking maneuvers were often performed with less than optimal confidence.

For hard-core offroaders, a locking rear differential is also offered, allowing for maximum traction on slippery surfaces.  Hill descent control uses the stability control and brakes to keep speed down when descending a grade steeper than 20%.  If that’s not enough, waterproofed headlights and door seals allow the Touareg to drive through about eighteen inches of water without trouble.  Four-wheel disc brakes are standard.

It’s definitely a departure for Volkswagen, but you wouldn’t know it.  There’s more than enough luxury and quality to make the Touareg at home in the competitive luxury SUV market.  The standard equipment list is long, and includes side-curtain airbags, a tire-pressure monitor and rain-sensing wipers.  Pricing starts at $34,900 for the V6, and V8s go for $40,700 and up.  Our test truck was a V8 and featured the optional air suspension, locking differential, navigation system and 19″ wheels which bumped the bottom line to $53,265.  That’s a bit more than we’d consider paying for a Volkswagen (it’s almost three Jettas, after all), even one as nice as the Touareg, but buyers who are more conservative with the amenities will find themselves in a luxury SUV that’s easily the equal of BMW’s X5 or Mercedes’ M-Class.

Specifications:
All specs are for the 2004 Volkswagen Touareg V8, which we tested.
Length:         187.2 in.
Width:            75.9 in.
Height:            68.0 in.
Wheelbase:        112.4 in.
Curb weight:        5086 lb.
Cargo space:        31 cu.ft (seats up); 71 cu.ft (seats folded)
Towing capacity:     7716 lb.
Base price:        $40,700
Price as tested:        $53,265
Engine:         4.2 liter 40-valve V8
Drivetrain:         six-speed automatic, four-wheel drive
Horsepower:         310 @ 6200
Torque:         302 @ 3000-4000
Fuel capacity:        26.4 gal.
Est. mileage:        14/18