Audi has been at the forefront of all-wheel drive on passenger cars, starting with its rally racers, and now it has readied yet another evolution.

The German company has just unveiled its new quattro system with “Ultra technology” that aims to improve fuel efficiency of all-wheel drive models thanks to a trick new setup.

Typically, AWD cars use more fuel than front- and rear-wheel drive ones because of increased friction (and, in most cases, weight). Audi’s new Ultra tech, though, makes the system operate in front-wheel drive mode under normal condition and sends power to the rear wheels only when necessary.

Not exactly a revolution, since AWD-on-demand has been used for quite some time. Still, Audi’s uses a number of new sensors that monitor things like steering input, grip and throttle pedal position, a processor located in the gearbox determines when the front wheels are about to lose traction and then funnels some power to the rear. By working in collaboration with the firm’s stability control system, sensors can also determine if the car is being driven hard and then engage the rear wheels if required

The system itself is also unique from the previous normal quattro setup as it incorporates a clutch between the gearbox and propshaft as well as one on the rear axle to allow for the seamless shift in power.

All told, the new all-wheel drive system is said to save about 0.3l/100 km and will debut on the new A4 Allroad in the coming months.

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