Once a defining feature of the market, compact luxury sport sedans are much scarcer nowadays. The 2018 Audi S3 is an excellent flag-bearer for the breed, with athletic performance matching Audi’s high-tech expertise. Along with the BMW M2 and the Mercedes-AMG CLA 45, it rounds out the German trio of offerings.

But the S3’s biggest competition comes from in house. The S3 shares an engine and structure with the Volkswagen Golf R, which boasts a hatchback’s cargo capacity and a less eye-watering price tag. The Audi S3 is lovable in its own right, but it struggles to distance itself from its sibling.

Best Value

If you’re springing for an Audi, you may as well enjoy the luxury and get the best technology they can throw at you. This is why we’d get the fancier of the two 2018 S3 trims, the S3 Prestige. It adds safety bonuses like adaptive cruise control and lane keeping assist, plus upscale features like navigation, a Bang & Olufsen sound system, and a futuristic touchpad on the rotary dial.

The S Sport package is worth the price as well. It adds Audi’s magnetic ride technology, which irons out imperfections in the road surface without compromising agility. Other packages add cosmetic tweaks on the seats or exterior, but the S3 is comfortable and flashy enough without them.

All together, here’s what our S3 of choice looks like:

  • Model: 2018 Audi S3 Prestige
  • Engine: 2.0-liter turbocharged four-cylinder
  • Output: 292 hp / 280 lb-ft
  • Transmission: Seven-speed dual-clutch automatic
  • Drivetrain: All-wheel drive
  • MPG: 22 City / 28 Hwy
  • Options: Metallic Exterior Color ($575), S Sport Package ($1,100, red brake calipers, Audi magnetic ride)
  • Base Price: $49,925 (including a $975 destination charge)
  • Best Value Price: $51,600

Performance

Audi S3

The S3’s 2.0-liter turbocharged powerplant is peppy enough to propel the sedan to 60 mph in just 4.7 seconds. Top speed is limited to 155. The torque comes on early at around 2,000 rpm and is on tap for most of the rev range, managed well by the seven-speed gearbox. Fuel economy is even respectable at an EPA-estimated 24 miles per gallon combined. With Audi’s chassis finesse and sophisticated all-wheel-drive system, the S3 is a blast to drive. For those who love the driver’s seat, compact sports cars like this are a joy.

Tragically, no manual-transmission S3s will make it across the Atlantic. The S3 is down on the horsepower figures of its Teutonic rivals, but Audi still has the fire-breathing RS3 waiting in the wings. Otherwise, it’s hard to find fault with the S3’s performance. It’s a thrilling and capable ride.

Style

The S3 follows the usual Audi dress code, businesslike and sleek. Subtle performance cues like a rear spoiler give an edge to the exterior, while a coupe-like roofline slopes down to the trunk. The S3 sits an inch lower than the A3, and the short overhangs give it an athletic appearance. On the inside, understated design meets high-tech in the form of LTE connectivity and a pop-up infotainment screen. Aesthetically, it’s a refined package.

Where the S3 suffers is practicality. It has just 10 cubic feet of cargo capacity behind the seats, and that sloping roofline means that head room is less than stellar. Both of these problems are solved by – you guessed it – the VW Golf R. The S3 is a pleasant place to be, but it’s best viewed from the driver’s seat.

The Best and Worst Things

The performance is exhilarating and the tech is integrated well, but the rear seat space and lack of a manual transmission are disappointing.

Right For? Wrong For?

Audi S3

The Audi S3 is right for the professional who wants luxury appointments but loves the driving experience. It looks the part and has the latest toys, but it’s also a joy to take up a mountain back road. In an era where luxury often brings bloated handling and numb steering, the S3 is a breath of fresh air.

If you need to carry your things with you (and you don’t mind a more workmanlike badge), it’s harder to justify the S3 over the Golf R. The RS3 has extra power in its corner, but the S3 must trade on its luxury and tech, which can only go so far.

The Bottom Line

The 2018 Audi S3 is easy to love, inside and out. We wish it were a little easier to justify buying one. The S3 sits a little too close to more mainstream hatchbacks, which have made strides in adding comfort and technology. Still, if you’re set on a small sport sedan, the S3 is one of the best you’ll find.