Audi TT 2.0 TFSI

Price: £24,265 (3.2-litre £29,285)
Engine: 1,984cc, four cylinders, 16 valves, turbocharger, 200bhp at 5,100-6,000rpm, 207lb ft at 1,800-5,000rpm
Transmission: six-speed gearbox, front-wheel drive
Performance: 149mph, 0-62 in 6.6sec, 36.7mpg official average, CO2: 183g/km

Even the purest of design objects get old, their clarity and impact fading with familiarity. The original Audi TT did well to last as long as it did.

We thrilled to the boldness of its Bauhaus-ian design, its constant curves and geometric control. We loved the way the concept became real with minimal change. Car nuts rued how aesthetic promise was shortchanged by the lacklustre driving experience. Fashion object, yes. Sports car, not really. The glitz was wearing down, and there was precious little beneath.

But the engineering mood has been changing at Audi along with design direction. Past stark simplicity has softened into more stylised lines, a sellout to a fashion that Audi once transcended. But there is no ambivalence about the changed driving characteristics.

It coincides with the arrival from Ford, as the suspension technical development chief, of Dr Stefan Gies. The Audi RS4 and some versions of the A3 and A6 show how Audi now understands that a) there's more to an engaging drive than roadholding and b) you don't need rock-hard suspension to make a car feel sporty.

Combine these new visual and dynamic philosophies, apply them to the TT idea and the result is the car you see here. The new TT is longer than the old one, more than three inches wider but just a smidge taller. The wheel arches are still round and hefty, but the lines and shapes are more flowing and less geometric.

It's very good-looking but no longer shocking. "The new TT is an evolution of the old car rather than something completely new," says its designer, Gary Telaak. "But it looks better. It was too short before."

The face has the Audi look but flattened, emphasising its relative width. You'll notice how long the rear hatchback is. It looks lean, lithe and dynamic in a way the old TT never did.

I'm sitting very low inside a new TT. Almost too low, because the dashboard is high and the bonnet is bulbous. If I raise the seat, the driving position goes wrong, making the seat's front edge too high to comfortably attack the pedals. That's one good reason for specifying the more versatile electric-seat adjustment.

But I'm very aware of the extra space arising from the increased width. The old TT was close to claustrophobic inside; the new one is cosy. And it's beautifully finished, with bright-metal rings for the instruments and the round vents and expensive-feeling textures.

The first TT set the trend for round, separated, metal-rimmed vents and made a feature of its aluminium struts between facia and centre tunnel, too. The new TT doesn't have them. I'm not sure about the flat-bottom steering wheel, though: it feels odd when feeding it through your hands.

This TT has the 2.0- litre, turbocharged, direct-injection engine that has already been praised in the VW Golf GTI, various other Audis and the Skoda Octavia vRS. It's great. It has a crisp edge to its note and terrific response from low speeds, with no detectable response lag, thanks to the high compression ratio made possible by the direct injection. Power is 200bhp and pace is plentiful for easy overtaking.

This engine is matched to a conventional front-wheel drive transmission rather than the quattro four-wheel drive. quattro comes as standard on the 3.2 V6 version, and will be offered later on the 2.0, but I'm not missing it. Its absence makes for a lighter TT, helped by a chassis and body structure of which 69 per cent, by weight, is aluminium. The remaining steel parts are mainly towards the rear, including the doors and tailgate, to help reduce nose-heaviness.

The structure, like that of the large A8 saloon, is welded, bonded, riveted and extruded. It's very strong, and feels it when you drive. The TT is far from being just a coupé-bodied Golf or A3. Its suspension design is similar to those hatchbacks, which means a rear system like that of the Ford Focus, but many of the components are in aluminium and the wheels are set further apart on their axles. The wheelbase is shorter, too, and the roll axis is higher relative to the occupants and the TT's height.

Thus the driver feels more in control, with each steering input having an immediate steering effect. You'd swear it had a different steering rack from a Golf or an A3, such is the heightened responsiveness, but it doesn't.

So I'm flicking my way through tight bends, finding that the steering's responsiveness doesn't equate with the lack of messages sent back to my hands. I am also marvelling at the way it traverses bumps. The old car felt stiff-jointed, hunch-shouldered; this one moves, breathes, flows. It has the optional Audi Magnetic Ride, which uses suspension dampers filled with magnetic fluid that gets more viscous when a magnetic field is applied around it. The oil contains minute iron particles each with an anti-corrosion coating. The viscosity can change in five milliseconds.

It's the same technology that Ferrari uses in the new 599 GTB, and it is breathtaking in its simplicity and speed of reaction. Each wheel's damping can alter in a near-instant to keep the TT taut or supple as required by road topography or driving style; switch the system to Sport and it remains adaptive, unlike lower-tech systems that stiffen and stay there. Here, the "map" shifts up the stiffness scale and the feeling of fluidity isn't ruined.

Now I'm snaking up and down Austrian Alps, 3.2-litre, 250bhp V6 ahead, a quattro drivetrain beneath. This TT is faster: 5.9 seconds to 62mph against 6.6. Both figures are improved upon if you specify the optional double-clutch, semi-automatic DSG transmission (now renamed S-tronic) and it sounds lovely. Also, the four-wheel drive lets you do a tail-flick as you power out of a slippery bend. I should be in heaven.

But the odd thing is that I prefer the 2.0. It feels lighter on its feet (the weight difference is a hefty 150kg), its turbo engine has more energy when accelerating from low speeds and it flows better when the accelerator, clutch, brakes and steering are coordinated. It's the same deal with the Golf R32 and GTI: most people prefer the latter.

So that's the new TT. The rear seat is still under-10s only, and there's no external release for the tailgate. But as a piece of moving automotive sculpture, it's pretty damn fabulous. But you should buy the 2.0, save money and feel smug, because it's the better car.

The rivals

BMW Z4 2.5 SI COUPE: £25,000 approx

This new closed-roof, fastback version of the Z4 sports car arrives soon, and looks like a cracked-glass image of a retro GT. We haven't driven it yet, but first reports suggest sharper responses than the roadster and more fun.

NISSAN 350Z: £26,345

Rear-wheel drive, six cylinders and a lot of engine (3.5 litres, 300bhp) for the money. Strictly a two-seater, the Z looks great but has an uncompromisingly firm, noisy ride. The rawness is only just below the surface.

ALFA ROMEO BRERA 2.2 JTS SV: £24,500

Dramatically styled coupé cousin of Alfa's 159 has a bigger engine than the TT, but more weight, no turbo and 185bhp. Brisk rather than quick, it has better rear-seat space but is a less sporty drive. V6 3.2 with 4WD is also offered.