Last December, Volkswagen's first-ever SUV was honored as Motor Trend's 2004 Sport/Utility of the Year without benefit of its top-gun powerplant. Available in Europe for some months now, VW's potent V-10 turbodiesel comes to Canada and 45 of these United States this summer. California and a few Northeastern states with extra-stringent particulate-emissions limits will remain diesel-less probably through 2006, after which low-sulfur fuel will become available in the U.S. VW hopes to bring the TDI engines to all states for 2007. In the meantime, lucky buyers have an SUV that, at a rated capacity of 7716 pounds, will tow more than a HUMMER H2 can, while getting nearly twice the fuel mileage at an EPA-rated 17 mpg city/23 mpg highway.

As diesels go, the VW V-10 is a sweetheart, smooth and quiet (especially with the windows up) as any premium offering should be. Turbo lag is nonexistent, and mountains of torque (553 pound-feet--more than that of a Dodge Viper) ensure instant throttle response, working through a six-speed Tiptronic transmission and 4XMotion four-wheel drive. All the rest of the Touareg features, such as adjustable suspension, a two-speed transfer case, and an exquisite leather-, wood-, and aluminum-trimmed cabin, still apply. Some buyers may balk at the idea of paying nearly $60K for a Volkswagen, but in the premium midsize SUV segment, this one stands out, combining an upscale experience with a parsimonious appetite for fuel.