First drive: Volkswagen Golf 7 starts at $21,490

VOLKSWAGEN today put the entire Australian small-car segment on notice by announcing a razor-sharp starting price of $21,490 (plus on-road costs) for the seventh-generation Golf.

Arriving on our shores eight months after it premiered in Europe, the latest iteration of the company’s trademark model is larger, substantially better-equipped, more frugal and – at the entry level – significantly more powerful than before.

Even better, Volkswagen has introduced something it has lacked in the face of stiff competition – capped price servicing. Golf owners will be able to see the cost of the work done under the bonnet of their Golfs for up to six years and over 90,000 kilometres.

The new Golf’s styling may be evolutionary – the differences are more marked in person – but under the skin sits an entirely new modular lightweight platform, new engines (coincidentally with the same capacities) and a plethora of active safety technology not found on its predecessor.

As the company puts it, “the new Golf improves on a successful formula but does not cost any more” – something that is sure to catch the ears of those considering arguably less-premium offerings such as the Mazda3, Toyota Corolla and Holden Cruze.

Performance enthusiasts will have to hold their horses for now, though. Today’s launch includes only the regular, mainstream Golf hatch. The potent new GTI will be here by year’s end, while the even more hardcore R and the dog-friendly Golf wagon will both emerge in Australia during 2014.

The German brand’s Australian arm has streamlined its range of offerings, axing the slow-selling 77TSI price-leader in favour of the $500 cheaper (and vastly better-equipped) base 90TSI.

It may make do with cheapo steel wheels like its 77TSI predecessor, but inside the cabin and under the bonnet things are markedly upgraded.

Standard equipment includes a 5.8-inch touchscreen with smartphone-style swiping, USB and Bluetooth connections, cruise control with speed limiter and a driver fatigue sensor.

Powering this is a 1.4-litre engine that produces the same 90kW and 200Nm as the old mid-range 90TSI, but VW claims to have redesigned every feature except for the cylinder spacing. A Comfortline version of the 90TSI is also now available, priced from $24,990.

The Comfortline adds, over and above the base, a reversing camera, 16-inch alloy wheels, dual-zone climate control, front and rear parking sensors, automatic headlights and bigger seat bolsters. Satellite navigation is now a more reasonable $950 option – it was $2500 on the Golf VI.

Replacing the 118TSI turbocharged/supercharged unit from the Golf VI is a less powerful, but 16 per cent more frugal single-turbo unit with the same 1.4-litre capacity, but downgraded outputs of 103kW, and 250Nm from 1500rpm.

This engine is available exclusively on the flagship Highline specification grade, priced from $31,990 (the same as the equivalent outgoing 118TSI).

Because the larger of the two new petrol units comes with cylinder de-activation – a feature traditionally the province of larger capacity engines with more cylinders – it is marginally more efficient, with claimed combined fuel use of 5.2 litres per 100 kilometres (compared with 5.4L/100km for the 90TSI).

Volkswagen will offer the 90TSI with either a six-speed manual (priced as quoted), or seven-speed dual-clutch “DSG” automatic transmission (which adds $2500 to the price).

The 103TSI is DSG only.

The Highline will also be the only version offered with a diesel powertrain, now called the 110TDI. The price of entry is the same as the old 103TDI, but performance is boosted with a more potent 110kW/320Nm 2.0-litre turbo-diesel unit with a claimed fuel use of 4.9L/100km.

Highline grades get standard equipment including satellite navigation, 17-inch alloy wheels, piano black cabin inserts and cloth/Alcantara ‘sports’ seats, among other things.

All variants bar the base are available with a $1300 driver assistance package that adds a load of active safety equipment including adaptive cruise control, a system that scans the road in front of the Golf and automatically jumps on the brakes if a collision is likely, driver-assisted automated parking for both forward and parallel bays, and a ‘proactive’ occupant protection system that closes the sunroof and tightens seatbelts when it senses an imminent crash.

All variants come with the “XDL” system used on the current Golf VI GTI hot hatch, which brakes the inside front wheel to negate understeer, where the front of the car tries to push wide around a corner. The range is standard with seven airbags and has just received the maximum five-star ANCAP crash test rating.

Volkswagen has ditched the old manual parking brake in favour of a space-saving electric unit mounted on the transmission tunnel, and all versions come standard with a system that keeps the car stationary in “D” until the throttle is pressed, saving the driver the burden of holding down the brake pedal in traffic jams.

At 4349mm, the new Golf is 150mm longer than the previous model, while the wheelbase has increased by 46mm to 2620mm. Leg, shoulder and headroom have all increased in the back, while cargo space has grown by 30 litres to 380L.

All variants get front and rear independent suspension and electrically assisted powered steering that has lightened ever so slightly. A simpler, cheaper, but less refined torsion beam rear set-up is available overseas, but won’t be coming here.

2013 Volkswagen Golf Pricing*

90TSI 6 Speed Manual	$21,490
90TSI 7 Speed DSG	$23,990
90TSI Comfortline 6 Speed Manual	$24,990
90TSI Comfortline 7 Speed DSG	$27,490
103TSI Highline 7 Speed DSG	$31,990
110TDI Highline 6 Speed DSG	$34,490

*Excludes on-road costs.