AUSTRALIA’S cheapest new seven-seater vehicle is now made in Europe and wears a Volkswagen badge.

The five-strong Caddy Life range was launched last week with prices ranging from $27,990 for the base 1.6-litre petrol seven-seater, to $42,990 for the 1.9-litre diesel five-seater bed-and-tent Camper edition.

It also ushers in Australia’s least-expensive diesel people-mover.

The Caddy Life shares the same body structure and mechanicals as the Caddy light commercial vehicle introduced in February last year.

Both are based on the current Golf V small-car platform, and are built in Poland.

Like its panel-van sibling, the Caddy Life utilises a beefed-up McPherson strut front suspension design and loses the Golf’s complex multi-link independent rear suspension for a simple leaf-spring set-up.

Besides being a cheaper solution, the two-layer Hotchkiss rear axle arrangement also allows for a lower and flatter rear-floor section. It also includes a 20mm anti-roll bar.

The Caddy van connection brings a 1833mm-tall, strengthened two-shell body structure sitting on a 2682mm wheelbase.

Twin sliding side doors boast a 70cm-wide by 124cm-high aperture for easy access to the three-berth middle, and two-person third, rows.

Both aisles are arranged in an ascending, ‘theatre style’ arrangement, to take advantage of the generous headspace available.

The rear-most row completely removes (be careful though it weighs a hefty 50kg) as well as folds forward, to create a 750-litre load space – or three cubic metres with the centre seats also folded.

A huge shelf exists above the front-passenger compartment, while a pair of underfloor, sliding door and overhead net compartments also exists, along with four cupholders, a bottle holder, cargo tie-down hooks and two 12-volt sockets.

Two engine and gearbox choices are available to drive the front wheels.

The least expensive is VW’s ubiquitous 1.6-litre single-overhead cam eight-valve four-cylinder petrol unit, presenting 75kW of power at 5600rpm and 148Nm of torque at 3800rpm.

Despite having roots in the 1970s, it is Euro-IV emissions compliant and returns an 8.4L/100km fuel-consumption average.

Volkswagen admits this engine, available solely with a five-speed manual gearbox, will only make up a small percentage of Caddy Life sales. It exists primarily as the range’s headline price opener.

This leaves the 1.9-litre SOHC 8V four-cylinder turbo-diesel TDI as the expected crowd puller, since it delivers 77kW at 4000rpm and 250Nm from 1900rpm.

Along with usefully more torque and fuel economy (6.2L/100km average), the Euro-IV-compliant TDI also offers the Caddy Life’s only automatic option, VW’s acclaimed dual-clutch DSG six-speed gearbox. It starts from a tenner under $35,000.

Steering is a powered electro-mechanical variety, while the standard four-wheel disc brakes are enhanced with anti-lock ABS and Electronic Brake Distribution and Brake Assist technology.

Volkswagen’s ESP stability control device is a $750 option across the range, along with $550 side airbags to complement the standard dual front SRS items.

Also included in every Caddy Life are semi-automatic air-conditioning, front fog lights, remote central locking, sliding centre-side windows, CD/radio audio, power windows and electric (and heated) exterior mirrors.

The TDI adds alloy wheels, cruise control, a trip computer, height-adjustable front seats with hidden drawers, and a lidded dash-top drawer.

Among the interesting options are hinged rear-side windows at $395 a piece.

Meanwhile the Caddy Life Camper – known as Tramper abroad – ditches the third row for a sunroof, a ‘Camper Kit’ (forward-folding front seats, a rollout bed for two, internal lighting and rear blind), two folding chairs, a folding table, rear-mounted tent (1976 Holden LX Torana ‘Hatch Hutch’ style) and side-mounted storage bags.

The Caddy Life extends Volkswagen’s people-mover strategy by slotting underneath the T5 Transporter van-based nine-seater Kombi and more-luxurious Multivan six or seven-seater ranges.

Urban families appreciating the Caddy Life’s compact 4.4m x 1.8m footprint, diesel engine availability and European heritage are targeted.

Rivals are cited as the Kia Carnival, Hyundai Trajet, Toyota Avensis Verso and Honda Odyssey people movers, as well as the Renault Scenic.

Volkswagen is frank about being unsure of how many buyers the Caddy Life will lure, except to say that it has brought in "a few hundred" for this year and that "TDI will be strong".

"We will know in about three months," says Volkswagen Group Australia managing director Jutta Dierks.

"It will be a volume model for us," she added.