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Audi’s timing couldn’t be better. The German prestige brand is bringing the five-door hatchback version of the A3 -- a compact premium car, for the purposes of pigeonholing -- to the U.S. market just as our Rabelaisian appetites are starting to get the better of us. Luxury SUV sales are off in double digits and full-size luxury car sales are sagging like Kirk Kerkorian’s glutei. With gas prices approaching $3 a gallon in some areas, the balance of trade decidedly unbalanced by imported oil, and a general darkening of the national mood ring, this seems like an excellent time to redefine the automotive spoils of affluence.

Enter the A3, one of a class of new European premium wagons that includes the Citroen C4, the BMW 1-series and the Mercedes-Benz B-class. For most Americans, Citroen might as well be a kind of tangerine; Mercedes’ plans to import the B-class sport tourer were recently torpedoed by unfavorable euro-dollar exchange rates; and plans for a U.S.-spec BMW 1-series remain off and on -- mostly off. So we should count ourselves lucky the A3 made it at all.

Scanning the yellowed pages of old buff books, you might conclude that entry-level hatchbacks from European premium brands don’t work. Consider the BMW 318ti, a three-door hatch that foun-dered on American shores until the waves finally took it in 1999. The Benz C-class hatch fared no better -- though, I must say, I liked that car quite a bit.

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The A3 is a kettle of different fish. For one thing, no one will drive this car and come away feeling cheated. The car’s turbocharged, direct-injection, 2.0-liter four-cylinder engine is a splendid hunk of horse-ware producing 100 hp per liter -- the benchmark of high-performance motors -- and 207 pound-feet of torque anywhere from 1,800 to 5,000 rpm, thanks to variable-valve timing and variable intake geometry. Combine this mesa-flat torque curve with six gears, available in either manual gearbox or Audi’s automatic-like Direct Shift Gearbox (DSG), and you get a car with fluid, elastic acceleration any time the ignition is switched on.

The turbocharger, built into the hottest part of the exhaust manifold, is always spinning and providing compressed air to the cylinders, which limits the ungainly surge that occurs in other cars when the turbos come online suddenly. Even so, with peak torque available pretty much all the time, it’s easy to spin the A3’s 17-inch front tires, provoking some torque steer and, in a corner, washing out front-end grip. Traction and stability control are standard equipment, but if you should hit their thresholds the car slows down like it has pulled a hamstring.

From a standing start, punch the go-button and the 3,329-pounder will accelerate to 60 mph in 6.7 seconds, the DSG cracking off three changes with Glock-like precision. Yahoo!

This was the first time I’d driven a car with Audi’s DSG system (giving you the option to shift gears with paddles on the steering wheel), and it was amazing. I love clutching and shifting, leg and arm, but this gearbox makes all that quite obsolete in a way an ordinary automatic never could.

Audi promised that the car would have TT levels of handling, which is not exactly the highest bar to clear. The car’s electric power steering is finely calibrated and well-weighted, the brakes sure and affirmative, and the general poise of the car composed. Body structure is rock hard, and the suspension -- MacPherson struts in front and multi-links in back -- strikes a nice balance between performance and ride comfort. Even so, the car’s front-heavy weight distribution made it a little less reactive in the corners above Malibu than I would have liked. I imagine the promised S3 version of the car will fix that.

And, P.S.: Despite all the glowing red and going fast, the car still gets 25 miles per gallon in the city and 31 mpg on the highway.

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Unfortunately for early adopters, Audi’s signature Quattro all-wheel-drive powertrain will not be initially available on the A3. Quattro will be paired with the 250-hp, 3.2-liter V6 and the DSG transmission, the same as in the top-shelf Audi TT, in the A3 early next year.

Another reason the A3 may fare better than its Euro forebears: Sport hatchbacks are hot -- at least ones with five doors. Three low-orbit premium brands -- Volvo (V50), Saab (9-2X) and Lexus (IS 300 Sportcross) -- are already in the segment. You may quibble over what constitutes a wagon or a hatchback, but it is clear that buyers are finding their way out of big SUVs and into smaller, cargo-friendly vehicles. And none too soon, sayeth I.

Owing to its European provenance -- and the Continent’s regulatory statutes regarding compacts -- the A3 is pretty close-coupled, only 168.7 inches nose to tail. The luggage space is comparable to that of a mid-size sedan: about 13 cubic feet. With rear seats folded flat, the cargo hold expands to 39 cubic feet.

So, while you can get a wind ski in the back, Audi expects most of the active-lifestyle folderol -- mountain bikes and the like -- to go up top, fixed to the optional roof rack.

The cabin appointments are a natural progression in Audi interior design. There are a few borrowings from the TT, including the alloy-bezel, circular climate outlets and the triangular braces at the center console, as well as the shared climate control panel.

A rich, well-handed quality greets the driver in the cockpit: The steering wheel is wrapped in textured leather; the door pulls feel cast in place. What makes the A3 notable is all the premium features poured into so taut a package. Standard features include a 10-speaker sound system; power windows with power retention; front and side air bags for front passengers; a side curtain air bag (rear-side air bags are optional), and traction and stability control. All that for $25,460.

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Add a few must-have options and you edge toward $30,000. The sport package ($1,800) adds, among other things, performance tires and suspension setup, alloy trim and leather seats with contrasting trim. Many of the same items are in the premium package ($2,025), so you only have to spend extra for one. DVD-based navigation ($1,950) is a stand-alone option.

Americans have lived through a period marked by what I think of as ugly wealth -- by-the-pound ostentation and insensible consumption, made even more heinous with unconscionable design. Escalade, anyone?

The Europeans learned long ago not to measure prestige by the yard or ton. What I propose, in a time of general belt-tightening, is that there is a certain cachet in appropriateness.

The Audi A3 is everything you might want in a premium car, only less.

*

2006 Audi A3 sport wagon

Base price: $25,460

Powertrain: Intercooled and turbocharged, direct-injection 2.0-liter inline four cylinder

with variable-valve timing and variable intake geometry; six-speed Direct Shift Gearbox (DSG) automatic (as tested) or six-speed manual; front-wheel drive.

Horsepower: 200 at 5,100 to 6,000 rpm

Torque: 207 pound-feet at 1,800 to 5,000 rpm

Curb weight: 3,329 pounds

0-60 mph: 6.7 seconds

Wheelbase: 101.4 inches

Overall length: 168.7 inches

EPA mileage: 25 miles per gallon city, 31 mpg highway

Final thoughts: A- for the A3

Automotive critic Dan Neil

can be reached at dan.neil@latimes.com.

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