VOLKSWAGEN Australia sees its new entry-level Tiguan 118TSI as the model to attract new buyers to its stylish compact SUV and a drive through the hills outside Byron Bay gave us no reason to think they will be disappointed in the purchase.

VW has dropped the price of getting into a Tiguan to below $30K the first time at $28,490, but the 118TSI comes with the smallest and lowest-powered of the three petrol engines on offer and sends power to the front wheels only. The 4Motion all-wheel-drive system is not offered in the 118TSI but is standard on the three higher-priced variants.

At this point the 118TSI is only available with a six-speed manual gearbox. A seven-speed DSG will come to the model as the automatic transmission option but not until sometime around mid-2012.

The DSG is a $2500 extra cost on the 132TSI and 103TDI models, so expect the 118TSI with DSG to break that $30K mark.

Potential buyers need not despair at the lack of AWD and DSG, or the smaller engine capacity, because the 118TSI is a cracker of an engine and works a treat in the Tiguan. The 1.4-litre ‘twin-charged’ engine that is also available in the Golf makes 118kW at 5800rpm but it’s the 240Nm of torque between 1500 and 4000rpm that makes it so sweet.

The twin-charged engine uses both a supercharger and a turbocharger. The mechanically engine-driven supercharger does its stuff at lower engine speeds, giving a diesel-like flat torque spread before the exhaust gas-spun turbocharger comes to life to give the top-end surge you expect of a petrol-fuelled engine. It’s a case of getting the best of both worlds and, as an added bonus, it is super efficient, recording 6.9L/100km of 95RON fuel on the combined cycle.

The hinterland behind Byron Bay is a maze of narrow, rough, winding roads that snake their way over the splendid hills and dales. In this country the tractability of the little engine makes itself felt, lugging the 1493kg Tiguan up steep climbs in higher gears than expected without labouring.

The lack of an auto transmission option is almost irrelevant as you can pick a suitable ratio and leave it there for the engine to do all the work. Knock it back a gear for sprightly performance or short-shift through to top on the highway for the best economy. The manual gearbox is light and easy to use and buyers wanting an auto should try this before they write it off.

All new Tiguans have a Hill Assist feature that holds the brake when taking off on hills and, while this is superfluous on auto or DSG transmissions, it makes driving the manual gearbox just that little bit easier.

The 118TSI chassis retains the strut front and multi-link rear suspension of the original model and the unchanged settings provide a firm ride while not being uncomfortable and is dynamic enough to reward enthusiastic drivers.

The steering uses an electro-mechanical assistance system for the rack, which is light and gives no reason for complaint.

What is evident, though, is an amount of kick-back through the front end to the steering wheel when you hit ruts or holes when cornering. These obstacles were plentiful on the northern New South Wales back roads and the kick-back was noted on many occasions.

The 4Motion Tiguan is available with 132TSI and 155TSI petrol engines and a 102TDI diesel engine.

We sampled the 155TSI over a shorter drive and of course the turbocharged 2.0-litre engine instantly felt more sprightly, while the standard seven-speed DSG is smooth and seamless on the open road. However, in tight, low-speed turns such as roundabouts and when parking it gets a bit clunky and slow, which blemishes an otherwise polished performance.

We drove the 103TDI over a tougher off-road course than any Tiguan buyer would expect of the vehicle. With no off-road buttons or levels to activate, we let the VW’s electronic traction control do the work as it climbed a damp and rutted track with relative ease. It did scrape its front bumper when we entered a deep hole on the wrong angle but the electronics were swift and more than up to the task.

A shallow creek crossing had a steep back on the exit where we expected the bumper could again be trouble but the Tiguan drove though without delay and when we tried to challenge it on a steeper climb while stopping and restarting, the 4Motion system was unfazed.

While the exterior of the Tiguan received a makeover with this 2011 update, the inside remains relatively unchanged. It is stylish and simple in a classic German way, with all the features you need and more if you purchase up the range or tick the option boxes.

The 155TSI’s black sports seats and dark interior look and feel top-class, with leather still an option. The ‘comfort’ option pack is standard on the 155TSI and includes dual-zone climate control, auto-dimming interior mirror, rain-sensing wipers, auto headlights with coming/leaving home function and illuminated vanity mirrors. This pack is a $1000 option on the lower grade models and was a nice addition on the 103TDI sampled, if only for the dual-zone climate control.

Whether or not buyers see value in the extra $900 a Tiguan 118TSI will cost them over a similarly powered Golf is yet to be seen but there’s no doubting that compact SUVs are hugely popular and this could be enough to win them over.