FOR a while it looked like Australia would not get the latest generation V70 wagon as the local market swung heavily towards SUVs, but in the end the company simply could not walk away from such a core product for the brand.

Volvo is renowned for its wagons and hopes that the new model will suit families that still consider the cost of petrol and also value the driving dynamics of a lower, lighter wagon that cannot be matched by the popular but bigger XC90.

For that reason, Volvo Australia has changed tack with its positioning of the V70 and underlined its dynamic credentials by pitching it as a sporty driver’s car, bearing all the performance and luxury equipment that implies.

That means that the third-generation V70 wagon steps up a level or two in price – by some $15,000 to $67,950 for the single-spec T6 model – but the comparison is onerous because the new model bears little resemblance to the old.

Just for starters, you get a potent turbo engine, four-wheel drive and a bunch of electronic systems. It is also bigger than before, being based on the S80 platform rather than the S60.

Volvo Australia has forecast a modest 10 sales a month, but our first experience on the road suggests that it deserves better than that and, while it will never approach the 160 a month being done by the XC90, it wouldn’t surprise if it comfortably exceeds expectations.

The first thing you notice is the urgency provided by the smooth-revving new 3.0-litre turbocharged six-cylinder engine that raises the performance game to some 210kW of power and 400Nm of torque (compared with 125kW/230Nm for the previous five-cylinder non-turbo unit and 175kW/320Nm for the 3.2-litre six in the V70-based XC70).

With a dual-stage turbo that produces impressive low-down response as well as top-end power, the V70 now jumps away from rest to 100km/h in 7.2 seconds – some 1.8 seconds faster than before. It’s not quite as neck-snapping as the numbers might suggest, but very lively nonetheless and not at all in keeping with people’s image of a Volvo wagon.

Matching the smooth and quiet new T6 engine is a slick six-speed automatic transmission that works well enough in normal mode but really provides excellent response in ‘Sport’.

With the sharper shifting in Sport mode comes the loss of overdrive, which is no real problem around town, and longer holding of gears, which can be a little frustrating when you’ve backed off and are just cruising, but it is better in this regard than many of its rivals.

There is also plenty of electronic adjustability of both the steering and suspension that is quite welcome.

With the steering set on its highest level of power assistance, the wheel feels way too light in your hands and seems unconnected, but switch it up (you have to be stationary and work through the menu options) and suddenly it feels just right.

Ditto with the suspension. Go for ‘Comfort’ and the car floats too much, but slip it up to Sport or Advanced – this time on the move and with the convenience of three buttons at the base of the gearshift – and you can feel the car instantly become more attached to the road, yet with little perceptible change in the ride quality.

In any setting, the V70, despite running on big 18-inch alloys (but with regular tyres rather than run-flats), absorbs bumps and potholes with admirable composure.

With the benefit of all-wheel drive, grip levels were incredibly high – so high, in fact, that we never reached them on our launch drive program. Heaven knows how hard you would have to push to break traction, let alone get into trouble in this mighty wagon.

Even when provoked, the V70 would hunker down and press on to the next corner with little fuss, a neutral attitude and rarely a squeak from the tyres. Even the standard stability control system works with you, coming on only in extreme situations and then so subtly that one has to look for the light on the dash to make sure it is working.

All this dynamic ability is matched by the impressive brakes, which ram the car into the ground without much noticeable ABS intervention under heavy application from high speed.

Not all the electronic aids are welcome, though. While the Volvo folk speak highly of their BLIS blind-side alert system – which has lights on each side mirror to let you know of vehicles in your so-called blind spots – we think it would be better for people to simply adjust their mirrors properly in the first place (you shouldn’t be able to see the side of your car, folks) and then not be distracted by constant flashing.

We also have no problem manually adjusting the windscreen wipers according to the conditions rather than relying on technology that, while quite impressive when you think about it, rarely works as we would like.

For us, the jury is still out on Volvo’s satellite-navigation system, which pops up at the top of the dash and is therefore high up for a good line of sight, but that puts it out of reach and therefore is not suited for a touch-screen.

We’re not sure about the driver controls behind the steering wheel (should the driver be playing with that while driving anyway?) and it seemed to take much longer than expected for the passenger to get where we wanted using the remote control. No doubt familiarity will help using both sets of controls, but we still prefer touchscreen controls.

Our only quibbles in terms of interior comfort were the artificial feel of the steering wheel, the fact that the front passenger seat only had manual adjustment and there’s quite a bit of wind noise from the A-pillars.

Otherwise, the interior is excellent, with a neat floating centre console, classy controls, handy pockets built into the front of each front seat squab and superbly comfortable seats with deep squabs that make long distances seem shorter.

With a longer wheelbase, there is more room in the back seat, so there should be few complaints from the passengers – even little ones, who benefit from Volvo’s innovative two-position height-adjustable rear outboard seats.

From the front seat, it was smooth sailing all the way over a long, varying and testing drive route that put the V70 wagon through its paces. And it came through with flying colours.

If you have kids or need the carrying capacity of a wagon but still like to drive, the V70 provides a compelling alternative to an SUV.