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The ATS was named Best New Luxury Car for 1013 by the Automobile Journalists Association of Canada.Gm

Cadillac's new ATS compact sports sedan doesn't just fill the too-long vacant entry-level slot in its lineup, it's a car that promises to generate respect for this North American luxury brand in a global marketplace it wants to become a more serious player in.

In the opening decade of the previous century, as the automotive era was dawning, newly minted Cadillac proved itself in the international arena by winning British reliability trials and hill climbs and the Dewar Trophy for mechanical excellence, leading to its "Standard of the World" claim.

But it then spent much of the next 75 years or so complacently, exclusively, and profitably pandering to parochial North American tastes – only to realize as the century was drawing to a close that customers with those unique automotive proclivities were rapidly disappearing, and not being replaced.

It took until the arrival of the new millennium for the entrenched conservatism (as one might politely term it) in Cadillac management to be displaced by fresh ideas and leadership – and a while after that to shift the division to its currently more positive place. Cadillac is now accelerating down a road that should return at least a measure of its former glory-days stature. The ATS will play a key role in that process.

If it lives up to the almost jingoistic reception it has received in much of the U.S press – to be fair it was also named Best New Luxury Car of the Year by the Automobile Journalists Association of Canada – it may prove to be the compact Cadillac that actually gets younger buyers back into its showrooms. It's not an embarrassment, as the long-ago and best-forgotten Cimarron was, and that market mis-read, the Catera.

Cadillac is anticipating it will be the division's volume leader and, along with the new XTS and soon-to-arrive next-generation CTS, significantly boost overall sales volume.

Cadillac unabashedly had its sights lined up on BMW's 3-Series when it conceived the ATS and it has the style, interior polish, equipment, technology and performance to go toe-to-toe with its German foe.

And like the also-new Bimmer, it comes with an attainable entry price that can be ramped up rapidly to far from luxury-car-starter-kit prices.

The base rear-wheel-drive ATS with 202-hp, 2.5-litre Ecotec four starts at $35,195, but for $36,985 you can step up to a 272-hp, turbo 2.0-litre, and for $43,935 to the 321-hp, 3.6-litre V-6 model.

All-wheel-drive is available for models with the 2.0-litre and 3.6-litre V-6 engines, the latter starting at $46,660. Our review vehicle was the $53,450 Premium AWD edition, with a few extras – $1,395 sunroof, $630 polished alloy wheels and a rather astonishing $1,295 Crystal Red Tintcoat paint job. Total tally, with destination charges, $58,465, or $21,675 more than the entry offering. Caddy won't be taking a back seat to BMW in upselling buyers.

Four-cylinder engines, particularly those packing turbos, are perfectly acceptable in the best automotive circles these days, but offering a V-6 makes sense for North America. Potential buyers here may still feel fours aren't acceptable in this class of car. And that a stodgy stigma, dating back to the days when V-8s ruled.

The ATS's V-6, familiar from the larger CTS, is a strong one, producing 321 hp and 275 lb-ft of torque, a considerable output for a car of this size; that is delivered to the all-wheel-drive system through a six-speed automatic transmission that can be shifted manually with steering-wheel paddles.

It feels refined, although not as silky as BMW's inline-six, emits a not unpleasant rasp as it revs to a heady 7,200 rpm. and makes the ATS a quick car. In AJAC Canadian Car of The Year testing, it accelerated to 100 km/h in 6.3 seconds and from 80 km/h to 120 km/h in 4 seconds. It is said to be a tenth or two quicker to 100 km/h than the 2.0-litre turbo.

The 2.5-engined model is the mileage champ rated at 9.2 litres/100 km city and 6.0 highway, while the 2.0-litre turbo scores 9.9 city/6.3 highway and the V-6 11.1 city/7.1 highway. The addition of the AWD system bumps that to 11.7 city/7.5 highway. The average after a week with the car was 12.5.

Either the 2.0-litre turbo-four – I'd lean to this award-winning unit – or the V-6 would be a good choice to propel this car which, in every other way, is a delight from a purely driving perspective.

Around town, it's responsive and its handy size makes it an agile urban street commando. Some handling circuit lapping revealed the steering has a directly connected feel, and the suspension is Nurburgring-tuned to a tautness that allows the P225/40R18 tires to respond to inputs with a – dare I say it – BMW-like responsiveness. The Brembo brakes are strong and respond through a firm pedal. On the open road, it feels solid and planted, the ride refined and the interior quiet, making it a comfortable cruiser.

Its interior – a bit compactly dimensioned and with just a 290-litre trunk – is crammed with luxury features, including Cadillac's CUE infotainment interface, and a nice mix of modern and traditional materials.

The ATS is eminently satisfying to drive and competitive in its segment, and will likely do much to further disperse the lingering remnants of Cadillac's past image.

Tech specs

2013 Cadillac ATS 3.6L Premium AWD

Type: Luxury sports sedan

Base Price: $53,450; as tested, $58,465

Engine: 3.6-litre, DOHC, V-6

Horsepower/torque: 321 hp/274 lb-ft

Transmission: Six-speed automatic

Drive: All-wheel

Fuel economy (litres/100 km): 11.7 city/7.5 highway; regular gas

Alternatives: BMW 3-Series, Audi A4, Acura TL, Lexus IS250, Hyundai Genesis, Mercedes-Benz C-class, Infiniti G37

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