The compact executive saloon class has never before seen competition of this level. Historically a segment that had the BMW 3 Series, Mercedes-Benz C-Class and the Audi A4 battling it out for supremacy, it was later joined by the Lexus IS in the late Nineties, as well as the Cadillac ATS and the Jaguar XE more recently. In fact, the little Jag managed to rattle the status quo when it stormed in a couple of years ago and impressed everyone with its sharp looks and dynamic abilities; the same attributes that helped it win the Best Premium Compact Saloon award in wheels Car of the Year 2016, a title previously held by the Mercedes-Benz C-Class. The plot has thickened, and rivalry among the contenders has reached unprecedented heights. So when Audi launched its latest B9-generation A4 here last week, we thought the best thing to do would be to line up two of our past champions along with the Cadillac ATS, which gave the last-generation BMW 3 Series (the current 328i was unavailable for this test) and the A4 a run for their money when we pitted them against each other in 2013.

The A4 is the freshest contender here. But as has always been the case with Audi, there isn’t much by way of styling that shows it’s new. Yes, there’s the clamshell bonnet with distinct creases on it, the redesigned grille, sleek, all-LED matrix headlights that distribute light in “several million” combinations, fibre-optic daytime running lights, plus taillights with cool sequential turn indicator strips. But still, in typical Audi tradition, all these changes can at best be described as subtle. And it’s only when you go through the specifications sheet that you realise the updated A4 is 25mm longer than the previous model at 4,726mm, 16mm wider at 1,842mm, and has a wheelbase that’s 12mm longer than before at 2,820mm. However, despite looking more like a mid-life refresh than a full redesign, what’s under the skin is thoroughly new. Based on an all-new version of the flexible MLB architecture that also underpins the Q7, the A4 is lighter by up to 120kg (in base 30 TFSI form) than the previous model. And it’s also one of the most aerodynamic cars on sale today with a drag coefficient of just 0.23. This shows most of the seemingly passive elements, including the boot lid, the roof, the mirror and the sealed underbody of the A4’s exterior, play an active role in the car’s aerodynamics. Overall, it’s an elegant executive saloon with subtle good looks.

But it isn’t the only attractive model in this group. The other three fight their respective corners fiercely. Take the XE — the critical spoke in the Jaguar juggernaut’s wheel. Launched into a segment that already boasts some of the best driving cars, it had an uphill task. But it’s lived up to the huge expectations and impressed all of us here at wheels, earning the top spot in the Compact Premium Saloon segment of our Car of the Year 2016.

In R-Sport trim, the XE features sharp and aggressive looks with a black grille, a front bumper with chrome blades, and 19in gloss-black rims, plus chrome side vents in the fenders. With bits of the F-Type and the XF apparent in the styling language, it’s arguably the best-looking car in this group — but having said that, the ATS is probably the most eye-catching because it’s so different. Was it a brave move by Cadillac to tackle the segment stalwarts head-on with this, or foolish? The ATS doesn’t have the history that the Germans possess, nor does it have perception on its side. When customers want a smart, compact luxury saloon, they’ve been programmed to head right for the Mercedes, Audi or BMW dealerships, but Cadillac thinks it can break that trend with this car. Stop laughing in the back. The ATS beats this lot in pricing and in terms of styling you won’t confuse it for anything else; the crisp sheet metal, bold front end and muscular rear demand a double take. The two Germans and the Brit go for a softer approach in their design but this American is angular, edgy and attractive. It’s far more understated, however, than the ATS-V and its pumped-up bonnet; this standard variant is subtle but it still gets LED headlights and taillights, and forged-aluminium 18in wheels.

Last but certainly not least, we have the Mercedes, which appears to be the grown-up in the bunch. It’s almost as classy as the flagship, and offers a supple ride and luxurious interior making it very desirable. Designed to take the fight to its German counterparts, and British and American adversaries, Stuttgart decided the way to do that was to prioritise comfort over sporty handling. Having said that, it hardly disgraces itself when you put your foot down — but the real thrills will come from the AMG variant. Still, it has you nodding in agreement before you even push the start button; this W205 bears a strong resemblance to the S-Class, borrowing its design cues such as the aggressive front grille, sweeping character lines, and the taut rear end. It’s far angrier-looking than the cheery CLA, which now handles entry-level duties for the three-pointed star. Some feel the C-Class has matured into a big luxury car that is trapped in a compact-car body. Maybe. Want it to look a tad more outlandish? Well, you can have the badge on the grille be lit up with LEDs while the addition of a Sport package adds more menacing bodywork and bigger wheels. Our tester’s sinewy headlights, 18in alloys and double character lines on the profile are enough to warrant a second look — but the thing about the C-Class is it doesn’t need to shout about its smart exterior like the Cadillac does.

The ATS shines bright when it comes to aesthetics, however, in base trim, the Caddy is up against the ropes. And the reason is because the other three are better in every other department. Take the cabin of the A4 for example. The characteristic Audi brilliance is apparent throughout, from the quality of materials used, the layout, the seating, ergonomics, as well as the technology that’s been crammed in. It has, without a doubt, the best interior in class. It features the continuous air vent strip seen in the Q7, that’s both functional as well as decorative, adding to the air of roominess in the cabin.

The MMI infotainment system comes with a fixed 8.3in screen placed centrally on the dashboard, offering pinch-and-zoom functionality through a touchpad on the centre console. Even more impressive is the high definition Virtual Cockpit gauge cluster that displays information in a window that’s 200mm by 80mm in size, and complete with a handy head-up display. Seats are generously proportioned, with even the rear chairs spacious enough to accommodate two adults in comfort. Thanks to the increased wheelbase, the overall interior length has grown by 17mm, which has resulted in a 23mm increase in rear legroom. Luggage capacity is also decent, holding 480 litres with the rear bench up and 965 litres with the seats folded down.

The ATS offers reasonable fit and finish and has comfortable seats, but it is badly let down by the CUE infotainment system and its haptic touch. It’s so infuriating to use that within moments of trying to adjust the volume or AC, you give up. This is a major negative. Audi’s MMI and Mercedes Comand systems, which use a multidirectional dial-type controller are far better. The ATS’s interior feels a tad more cramped than the C-Class and A4 (but roomier than the XE) and the blame may reside with the heavily padded seats, however, they are well-bolstered. There’s a Bose premium seven-speaker audio system in there, which sounds very good, along with push-button start and eight airbags. The Jaguar’s cabin shares goodies like the instrument cluster with the F-Type, and the rotary gear selector with the rest of the Jaguar and Land Rover models. Although it’s subjective, we’ve never been big fans of this gear knob, which is counter-intuitive in a sporty saloon. Design and layout of the cabin is rather conservative, but the general arrangement of switchgear is practical and convenient.

The driving position is good, too, and the front seats are supportive even when you’re belting the car. The same can’t be said about the rear seats, though, which are tight even for two average-sized adults, with the large transmission tunnel making it nearly impossible to accommodate a third passenger in the middle. The low roofline also makes getting in and out a chore.

Also, the XE’s interior doesn’t feel as solidly built as the A4 or the C-Class, speaking of which, there’s almost nothing to dislike about the Merc. Almost. The free-standing infotainment monitor looks like a last-minute addition and lets the otherwise smart cabin down pretty badly. It packs a host of kit including rear-view and overhead-view cameras, lane-departure system, a head-up display, and on the safety front it packs nine airbags along with a fatigue-detection system, which monitors steering behaviour. It seems to have it all, but is it up to the task of fending off the A4, XE and ATS when it comes to performance?

Starting with the Audi, if we were asked to choose one aspect of the A4 that places it head and shoulders above the rest in this group, it’s undoubtedly the 2.0-litre turbocharged four-pot, which puts out 252bhp and 370Nm of torque. Mated to a seven-speed dual-clutch automatic transmission that sends power to all four wheels in our quattro test car, it’s the smoothest and most effortlessly powerful mill among the four. The slick dual-clutch ’box shifts seamlessly, bar the occasional hesitation at lower speeds. Audi claims 0-100kph in 5.8 seconds, but the sense of urgency with which the A4 dashes ahead makes it appear quicker still. Straight-line performance is incredible, and thanks to the stiff body structure, adaptive dampers and tweaked five-link suspension, driving dynamics are right up there with the best. The steering isn’t the most responsive, especially in Comfort mode, but in combination with the rest of the car’s handling abilities, makes for a highly entertaining package. The A4’s suspension is also impressively refined, showing a hint of harshness in Dynamic, which, despite this, is the mode we’d have it in all the time.

Moving on to the Jaguar, it’s not the ergonomics or quality of materials that made it a winner at our awards; it’s the performance. The XE’s 2.0-litre four-cylinder turbocharged mill churns out 236bhp and 340Nm of torque, and paired with an eight-speed auto, is impressively responsive and smooth at higher revs, but shows a clear lack of enthusiasm lower down in the rev range. The gearbox shifts fine when left in the automatic D mode, but is much better off controlled via paddle shifters in Sport. It also delectably firms up the steering and the suspension, which is the same double wishbone as the F-Type up front and aluminium intensive integral link set-up at the back. In its most potent setting, the XE R-Sport is one of the best handling cars in its class. However, it lacks the refinement of the Audi, especially with the tenacious rattle from the engine making its way into the cabin in a much less-pleasant manner than we’d like.

The C-Class, meanwhile, is 100kg lighter than the previous generation thanks to a new structure that uses aluminium extensively throughout the body, so it now tips the scales at 1,480kg and this reduction in weight helps it to pounce eagerly in the corners. Our C 250 had the 2.0-litre four-cylinder motor mated to a seven-speed automatic that sent all of the 211 horses to the rear wheels, making it the third most potent in the group. The 1,991cc motor may be up by seven horses and 40Nm of torque over the predecessor but it’s no road missile. That said, it feels competent and has a willing nature, which moves the handsome Merc with minimum fuss. It can reach 100kph from rest in 6.6 seconds and has a top speed of 250kph. It feels agile and inspires confidence to push it harder. There’s little drama in the way it goes about its business, though, and it feels unflustered most of the time. That’s probably due to the fact that the little four-pot doesn’t have the ability to upset it. With a peak torque of 350Nm delivered across a wide range of revs, it has plenty of in-gear flexibility.

The optional air suspension on our tester offers five driving modes (Individual, Eco, Comfort, Sport and Sport Plus) with the settings adjusting response to the transmission, throttle, engine braking and the amount of slip allowed by the stability-control system. The newly developed electromechanical steering gets stiffer with each setting and the chassis doesn’t flex as you dart from left to right. Body roll is all but eliminated in Sport Plus and in Comfort, it soaks up the bumps and thumps with ease.

Last, in terms of output at least, is the ATS; what we have here for this test is the 2.5-litre four-cylinder with 202 horsepower. It isn’t a bad unit, but pales in comparison to the XE, A4 and C 250’s mills. Cadillacs are supposed to feel special but this one doesn’t give you that sensation when you start it up and take it for a drive. The motor has got a significant amount of criticism from all angles but the naturally aspirated four-banger doesn’t deserve all the bad press. It only has 258Nm of torque so it isn’t a power monster, but it is a smooth and responsive unit. It won’t win you any street races but it isn’t supposed to; this engine is for those who don’t care about posting fast 0-100kph times or being buried in the leather seats when they floor the throttle. It’s for those who want a comfortable and smooth ride in their luxury car. Mated to a six-speed automatic that sends the power to the rear wheels, it shifts up and down smoothly, however manual shifts via the gear lever aren’t as sharp as you’d hope. It’s the weakest of the bunch and in a region where large numbers matter.

However, it may not pack a hefty punch but when it’s cruising along, the ride quality is very good. The Magnetic Ride Control keeps it flat and poised, the electric power steering offers good feedback, and overall, the ATS is an appealing option, especially when prices start from as low as Dh125,000.

So do we have a clear winner here? Yes, we do. Lighter, faster, sharper to drive and boasting one of the best four-cylinder engines in its class, the new Audi A4 stands tall among its mighty adversaries. It outshines the competition offering a much more desirable overall package than any other car in this price range does. However, the Jag and the Merc run it close, one with its good looks and dynamics, and the other with a combination of understated elegance and athleticism. The ATS offers the best value for money proposition in this group, and is a great executive saloon in its own right. But in this company, it falls short. However, considering the fact that it’s now the oldest model in the segment and how quickly things are changing at Cadillac, the next-generation ATS could well pose a serious challenge to the establishment.