On sale by the summer of 2003, the Touareg (named after a strong-willed self-reliant nomadic tribe of the Sahara), VW's first shot into the high-end-SUV segment, will offer full-time all-wheel drive, a low-range gear, four-wheel traction control, and an adjustable-ride-height air-suspension. Offered with three engines in the U.S., the first Touaregs will have a new 4.2L V-8, producing 310 hp and 305 lb-ft of torque. A 3.2L V-6 will be offered six months later, with the 420-hp W-12 going on sale in June 2004. As you might imagine, the W-12 offers a huge amount of groin-pulling power for a vehicle this size. Expect the Porsche Cayenne to have a few more power surprises, as well.

Designed to handle difficult terrain challenges, the Touareg will offer center and rear locking differentials and 275/45R19 Yokohama tires. Inside, it's full of the same high-quality details as the Phaeton, with four-zone climate control, excellent dash and console materials and textures, and a clean, readable gauge layout. Clearly designed to compete with the BMW X5, Mercedes ML, Acura MDX, and Volvo XC90, the V-6 Touareg should start around $34,000.

No matter what the engine, the six-speed transmission gives the Touareg plenty of jump off the line with nimble slow-speed-crawling flexibility and higher-speed firmness; however, we caution all who test drive the W-12: You'll become addicted. Likewise, we found the premium air suspension our favorite package. It offers remarkable comfort on broken terrain and during higher-speed S-turn maneuvers. Wider and longer than the ML and X5, the Touareg could become the new German SUV expert in its class.