Since the demise of the famous and venerable VW Bug, Volkswagen has been developing and refining new “fun to drive” cars in the hope one of them will dominate the market in the way of the Bug.

The latest out of Wolfsburg is the new $25,235 VW Passat wagon. With a potent 2.0 liter, 4-cylinder, 200 hp turbocharged engine, a six-speed automatic transmission with Tiptronic manual override and pretty precise handling, this car is fun to drive. Even commuters who don’t particularly like driving will appreciate the rapid acceleration, the stability on corners, and the powerful fade-free, four-wheel disc brakes.

Volkswagen’s 2007 Passat is fast and fun to drive, but quality concerns remain.

As a wagon, the Passat’s rear seats fold flat, allowing long items to be transported or, with an air mattress, to house an emergency sleepover. The standard roof rack adds to its carrying capacity. The rear door is powered open and shut.

The interior is nicely finished, but the driver’s leatherette seat becomes sticky in hot humid weather. This raises the issue of air conditioning, which is weak - taking up to five miles in hot weather to get comfortable. The control is a dated manual system where one knob sets the temperature and another controls four fan speeds. Noise from the fan at maximum speed will shut down conversation and make the radio almost inaudible.

The front cup holders are OK, but the rear ones are the usual flimsy, plastic mechanical German wonders that magically appear once you learn the trick. The red and blue instrument panel is quite handsome and has precise-looking gauges.

The ride is firm and stable at all speeds, but road noise is sometimes intrusive. The VW warranty is four years or 50,000 miles for the car and five years or 60,000 miles for the powertrain. Expect GM’s latest powertrain warranty of six years or 100,000 miles to put some pressure on VW and others.

EPA estimated fuel consumption with the 2.0 liter turbo is 23 city/31 highway. Premium gas is required, putting a different light on the Passat wagon’s fuel economy.

J.D. power has not been kind to Volkswagen in its initial quality and reliability surveys, ranking the company near the bottom with Land Rover, Suzuki, Saab and Isuzu. There is really no excuse for this; other manufacturers, including GM and Hyundai, have pulled themselves out of the quality slump. It is a pity, since VW has some really good car designs.

VW offers two 3.6 liter V-6 versions of this wagon, one at $31,160 with standard two-wheel drive and the $33,110 “4motion” with four-wheel drive. The 280 hp V-6 engine really makes this a full blown sports wagon. The V-6 propels this package to 60 mph in 6.24 seconds; the 2.0 liter turbocharged 4-cylinder does it in 7.97 seconds. Neither of these cars is a slouch.

A little nicer version of the 2.0 liter wagon, the $26,175 2.0T, offers front seat power recliners and lumbar adjustment, a rear seat trunk pass-through area and nice- looking alloy wheels.

Options for the 2.0 liter cars include a $1,750 package with power sunroof, premium radio with eight speakers, six-disc CD changer and Sirius or XM satellite radio with three months of service included. If in addition to the above you want leather seats, shift knob, and steering wheel; automatic climate control; steering wheel mounted radio controls; auto headlights; fog lights; rain sensors; full power front seats and three-position memory, it will cost you $4,400. Another package with all of the above and a few extra baubles costs $5,450. A navigation system is $1,800, and a premium radio and CD system on its own costs $1,000.

Among the alloy wheel options, Lemans wheels are $400, Samarkand wheels are $1,000, and Akiros wheels are$1,449.

Volkswagen has a long and checkered history in the U.S., including closing its Pennsylvania manufacturing plant in the 1980s after some disastrous sales years. This Passat wagon is one of a new series of excellent vehicle designs which should boost VW’s sales here, but they really need to confront their quality issues and get them under control. Americans have little patience with automobiles that have issues.

Motoring since 1952, Austin Lynas has owned 55 cars and at one time raced mini-sedans in England. An aerospace engineer, he was instrumental in developing the anti-skid systems used in British military aircraft that preceded today’s ABS systems. Lynas can be reached by e-mail at austin@sandiegometro.com.