That meant the last-generation Audi A8 was right on the money; svelte, high-tech and beautifully built but without the blatant 'look at me' factor that its rival from Stuttgart so inelegantly screamed. It never surpassed its BMW and Mercedes rivals in sales terms but it established Audi as a serious player in the market and showcased the company's forward thinking with its all- aluminium construction.

Fast-forward to the early '00s and the luxury market is once again split into two camps. The current S-class is a model of understatement and disguises its bulk effortlessly, both from the outside and from the driver's seat. It's been a great success. But the huge and unapologetic luxury car is making a comeback, hence the semi-detached sized Range Rover and the undeniably imposing, if controversially styled, 7-series BMW.

Despite this new movement, Audi has stuck to its guns with the new A8 and is aiming at those who crave dynamism and stealth from a big saloon. The one phrase that dominates the press pack is 'driver's car' so does it live up to the tag?

Well, things start promisingly enough as you approach the new flagship. From a distance it looks tautly proportioned and hunkered down on its springs. The steeply raked and surprisingly low roofline gives the new A8 a coupe-like stance. Climb into the airy and beautifully constructed cabin and, if you've been in any other modern Audi, you'll immediately feel a sense of familiarity. The A8 builds on the exceptionally clean layout of its smaller brothers with even higher quality materials and a new focal point called MMI (Multi Media Interface). which is similar to BMW's iDrive system - only made simple and intuitive. You still get the central control knob but three buttons either side of it access individual menus on the dash-mounted pop-up screen. Suffice to say it works.

The real news is that Audi has gone to great lengths to endow the A8 with the agility and performance of a much smaller car. The aluminium spaceframe is a good starting point, this time made of fewer components than the last A8 structure, which brings benefits in structural rigidity (up 60 per cent), weight and production cost. This is allied to a refined version of the basic chassis set-up from the previous A8 - a four-link front suspension arrangement and trapezoidal-link rear - and a brand new air suspension system that strikes a fine balance between ride comfort and handling accuracy.

In theory, the adaptive air suspension gives the A8 continuously variable damper settings and reduces both pitch and roll to a minimum in normal driving conditions. It also offers either 'comfort' or 'dynamic' settings, the latter reducing ride height by 20mm and firming up the damping response.

On the varied roads near Ingolstadt, the 335bhp 4.2-litre A8 (there's also a 280bhp 3.7 version) proves an engaging companion. It steers crisply and accurately and the ride's excellent. The six-speed auto 'box works well too - kicking down keenly on demand, slurring changes efficiently when you're cruising. Even at low speed the A8 feels agile and light on its feet and it remains neutral through all but the tightest of corners. The V8 is surprisingly vocal when the throttle's pinned against the carpet but it's hushed at motorway speeds and around town.

If you do decide to turn off the ESP, the A8 keeps its composure through fast turns with a faithful and confidence-building neutral stance. Look for real thrills, though, and the A8 can't quite deliver. Grip is huge but inevitably the A8 pushes its nose wide in tighter corners and it's reluctant to adjust its attitude on the throttle once understeer has set in. Body-roll also builds up to a degree that you wouldn't expect with the trick air suspension.

So the sporting demeanour the A8 displays at low to medium speeds evaporates if you really push on. But then most owners won't, and it's a neat trick to make the A8 feel so sporting and keen at a level that all drivers will access, whilst keeping the Audi philosophy of 'safety first' closer to the car's limits. Back on the autobahn is where the A8 shines - rock-steady at an indicated 150mph, aided by its totally flat underbody.

The A8 doesn't quite add up. It does all practically everything you could ask of a luxury machine, yet in the quest to make it sporty and stealthy Audi has managed to create something that doesn't quite feel like a lavish range-topper. It seems strange to criticise the A8 when it achieves its goals so completely, but with cars as bold as the 7-series out there I can't help feeling that its timing isn't quite right. If you want to slip by unseen the A8 is a fabulous tool, but at the moment the fashion is for getting noticed.