VOLKSWAGEN Group Australia has lowered the entry price to its Tiguan compact SUV range by $5500 with the introduction of an economical two-wheel-drive 1.4-litre 118TSI petrol model variant, starting from just $28,490 (plus on-road costs).

Dropping the Tiguan baseline below $30,000 for the first time, the substantial midlife upgrade to the small SUV range launched this week enables the German brand to compete with rival manufacturers offering 2WD variants in the incredibly popular segment and should provide a big boost in sales volume.

Available with a six-speed manual only, the 118kW/240Nm 118TSI ‘Twincharger’ becomes the most fuel-efficient petrol-fuelled Tiguan with a combined-cycle economy figure of 6.9 litres per 100km, a figure achieved with the inclusion of VW’s BlueMotion Technologies including engine idle-stop and a ‘smart charging’ system that only charges the electrical system when engine power is not being used.

Carbon dioxide emissions are rated at 162 grams per kilometre.

The 118TSI joins the three model variants previously available in the Tiguan range, although all have been updated and revised.

The two other petrol engines comprise a 132kW/280Nm 2.0-litre 132TSI, available with a choice of six-speed manual or seven-speed DSG dual-clutch transmission starting from $33,490 and $35,990 respectively, plus a top-of-the-range 155kW/280Nm 2.0-litre 155TSI that is only available with DSG at $42,990.

The 132TSI price represents a $500 drop compared to the outgoing 125TSI, while the 155TSI holds firm compared to the previous 147TSI.

The sole diesel choice remains the familiar 103kW/320Nm 103TDI engine that comes standard with a six-speed manual for $35,990 – down $700 – or with the seven-speed DSG for $38,490.

Significantly, the 103TDI also now employs BlueMotion Technology with idle-stop and, when combined with DSG, a ‘coasting’ function. The latter is enabled via the multifunction display and disengages the clutch pack, allowing the vehicle to roll without engine braking and using the momentum of the vehicle to save fuel.

When the brake, accelerator pedal or the gearshift lever is operated, the clutch is re-engaged and engine braking again takes effect.

The 103TDI now returns 6.0L/100km (DSG: 6.2L) and 156g/km of CO2 (DSG: 164g).

All 132TSI, 155TSI and 103TDI variants use VW’s 4Motion all-wheel-drive system as standard and are not available in 2WD.

The heavily revised Tiguan was first seen at the Geneva motor show in March ahead of its launch three months later in Germany, where it is the top-selling SUV on the market.

The Tiguan’s five-door wagon body remains essentially unchanged but adapts the now standard Volkswagen face shared with the likes of the latest Golf, Amarok and Touareg.

This comprises a redesigned grille that runs the full width between the updated headlights to form a single unit. A new-design front bumper incorporates a trapezoidal lower air intake opening and foglights, while at the rear new L-shaped tail-lights add the style of the latest Touareg.

Standard features across the Tiguan range run to electronic stability and traction control, ABS brakes, brake assist, a hill holder, electronic diff lock, six airbags (front, front side and front and rear curtain), remote central locking, 60/40-split folding and sliding rear seats, cruise control, Bluetooth phone and audio streaming, daytime running lights, heated door mirrors, air-conditioning, a multi-function display, multi-function leather-clad steering wheel and an eight-speaker ‘RCD310’ audio system with USB connection.

All models bar the 155TSI are fitted as standard with 16-inch alloy wheels while the 155 gets 17-inch alloys. A selection of 18-inch alloys is optionally available and the spare wheel is a space-saver.

Other features on the 155TSI over the lower-spec models include front foglights with static cornering lights, a tyre pressure indicator, driver ‘fatigue detection’, chrome-plated side mouldings, roof rails and window surrounds, tinted windows, dual-zone climate-control, sports front seats with height and lumbar adjustment, storage drawers under the front seats, a premium touchscreen audio system, automatic headlights, rain-sensing windscreen wipers and rear parking distance sensors.

The updated model also maintains its five-star ANCAP safety rating.

The body features the same dimensions as the original and the stubby rear end makes it the shortest wagon in its class at 4427mm in overall length. Most of the length is missing from the boot that has a claimed 395 litres capacity or up to 1510 litres with the seats folded.

Tiguan was one of the pioneers of autonomous parking systems that park the vehicle without driver assistance and was the first to offer such technology in an affordable, non-luxury vehicle. Park Assist continues to be offered as an option on Tiguan with ‘Park Assist 2’, which can now park the vehicle in both 90 degree and parallel spots.

Park Assist 2 is a $1400 option on all models bar the 155TSI, in which it costs $900.

Another hi-tech feature now fitted to Tiguan is ‘fatigue detection’.

For the first 15 minutes of a journey, fatigue detection analyses the driver’s characteristic steering and driving behaviour.

Further into the journey the system continually evaluates signals such as steering angle, use of pedals and transverse acceleration and if the monitored parameters indicate a deviation from the behaviour recorded at the beginning of the trip, then waning concentration is assumed and a warning is issued in the form of a five-second alarm.

If the driver does not take a break within the next 15 minutes, the warning is repeated.

Australian-spec Tiguans previously had the option of an off-road pack which altered the calibration of the centre differential lock, throttle mapping, traction and stability control and ABS calibration, and added hill descent control.

However, this off-road option has been deleted due to the low uptake. Thus, hill descent control is no longer available on the Tiguan here.

In Europe, the new Tiguan is offered in separate on- and off-road variants, with the off-road model featuring different front bumpers which make it 6mm longer than the on-road version but give it a steeper, 28-degree approach angle for more front-end clearance.

All Australian-spec Tiguans feature the off-road style bumpers and there is no separate model specification for on- and off-road.

The Tiguan arrived in Australia midway though 2008 as one of the few European entries in the compact SUV segment, which is dominated by vehicles from Japan and, more recently, Korea.

It will be joined in the segment next month by the Skoda Yeti, which rides on a similar VW platform.

Despite offering Euro feel, safety and dynamics at competitive pricing to the market leaders in the Subaru Forester, Toyota RAV4 and Nissan X-Trail, the Tiguan managed only 1109 sales in its first year, 4702 in 2009 and 6216 in 2010.

The latter gave it a 5.4 per cent share of the hotly contested segment which was dominated by Forester and RAV4 with 12.8 and 12.7 per cent respectively.

Nonetheless, the Tiguan remains Volkswagen Australia’s second best-selling model behind the Golf and ahead of Polo and Passat.

This year, Tiguan is shaping up to a similar result, with 5.3 per cent of the market as of the end of September, although VW is hopeful the new model will boost sales over the last three months and into 2012.

The compact SUV market is getting tougher all the time, with vehicles like the latest Kia Sportage and Hyundai iX35 successfully staking their claim on the limited turf and all-new entries like the forthcoming Mazda CX-5 set to make their presence felt as well.