SUBARU started taking liberties with the Australian new-car market as long ago as 1989 - long before it had established itself as a truly credible force here - when it launched a new, larger car to complement the respected but marginally successful Leone.

The bigger car was tagged Liberty and many people wondered whether it would be capable of introducing the bold new era that its name implied.

As it happens, the Liberty did mark a new start for Subaru. If people’s perceptions had been coloured by the slightly offbeat Subarus of the past, then they were altered by this car.

It was built on the fundamental mechanical differences that defined the brand, but packaged in a more refined way.

The next-generation Liberty came in 1994, supported from below by the newly launched Impreza range that has since gone on to absolutely establish Subaru in Australia.

In fact, it’s hard to believe the giant-killing WRX was first seen here as long ago as 1994, going unrecognised for a while until starting to mark its mark as a formidable rally weapon.

Now we have a fourth-generation Liberty. It follows the third-generation model introduced in 1998, and it confirms that the company intends staying on the path it first began mapping out 15 years ago. Subaru understands its strengths and has learned how to capitalise on them.

Always a technology-biased car-maker, the company today is the repository of all-wheel-drive expertise within the General Motors empire.

Subaru first began playing around with 4WD in the 1970s, with the 1.4-litre wagon that preceded the Leone. Its "boxer" front-drive, north-south engine made the conversion to all-wheel drive relatively neat and easy, in that the drive for the rear wheels could be taken directly off the back of the gearbox – much easier than a laterally mounted front-drive engine.

It was a pretty crude, part-time four-wheel drive, without the third differentials, multi-plate clutches, or viscous-coupled systems used today, and could only be used on low-friction surfaces.

Attempting to use 4WD on hard, dry surfaces could result in binding-up of the transmission as the front and rear wheels fought to tear the car apart (the same rules still apply today to part-time off-roaders like the Nissan Patrol or Mitsubishi Challenger).

But Subaru was nothing if not resourceful, and at one stage offered a four-wheel drive that would activate itself when the windscreen wipers were switched on. The assumption was that this meant the road surface was wet and slippery, allowing enough wheel slip to prevent the dreaded axle bind-up.

These days all Subarus use a centre differential that apportions power between front and rear axles and allows all-weather, all-surface, permanent four-wheel drive.

The north-south engine layout continues as the foundation for the neat four-wheel drive configuration, in which the direction of driving forces does not need to make a right-angle turn, as it does with an east-west engine, to make its way to the rear wheels.

To get the message across, the company calls it symmetrical all-wheel drive and there can be no arguing it’s among the neatest, cleanest all-wheel drive systems in popular use anywhere today.

The latest Liberty continues to put all these principles to good use. The new car is bigger than the previous model smoother, quieter, yet faster, safer, cleaner running and more economical.

And it continues to develop as a range that offers a slightly different approach to other Japanese brands. Stylistically it is more conservative and controlled than adventurous, but with an understanding of how basic forms can be used in a tasteful, appealing way so they will still look good in five years’ time. A sort of European approach.

The bigger body (60mm longer, 45mm wider and 10mm higher), slightly lengthened wheelbase and front and rear track dimensions give it a larger presence on the road and although it’s roughly the same size as a Mazda6 or Honda Accord Euro, it somehow seems bigger.

Subaru says the new car is lighter on average by around 60kg, underlying this by saying it should really have been 130kg more as a result of the structural toughening-up (it’s 10 per cent more rigid than before) and extra standard equipment. The Liberty is also very aerodynamic with a drag figure of just 0.28 in sedan models (0.30 in wagons).

The weight reductions have come from quite extensive use of aluminium in places like the bonnet and bumper beams, suspension and, on all wagons, the tailgate.

Certainly the new car comes across as very refined. The frameless doors shut with a lovely thudding sound and there’s a pleasant, restrained but quite classy approach to detail design.

The doors on the volume-selling 2.5-litre version we drove were trimmed with a neat touch of brushed aluminium connecting the door-pulls and the power window switches, while leather was used on the steering wheel rim, handbrake and gearshift boots (the test car was a manual). The fascia is presented in a simple, elegant way using good quality, soft-touch vinyls in all the important places.

Space, generally, abounds with easily enough room for tall drivers, but there's no telescopic steering wheel adjustment. The Liberty also has what Subaru describes as sports seats they are probably best described as almost-sport seats because while they have a modicum of padding to add lateral support, they are still easy to slide in and out of.

Engines have been revised for the new model too, using the same basic "boxer" principles but raising power across the board by up to 10 per cent. Some 80 per cent of engine components were redesigned and the 2.5-litre and 2.0-litre turbo models get more efficient – and better sounding, with a muted horizontally opposed four-cylinder beat – dual exhaust systems.

The single overhead camshaft (per bank) engine adopts a fly-by-wire accelerator with no mechanical linkages between the foot pedal and the fuel injection system.

The 2.5-litre engine favours torque production rather than outright kiloWatts, producing 121kW at a conservative 5600rpm (up five per cent) and 226Nm at what seems like a high 4400rpm - until you realise the torque curve is pretty flat and there’s plenty of punch available at much lower revs.

The Liberty is thus a relaxed car to drive, responsive to the accelerator at all times and, in the manual version, smooth of clutch and with a quite precise, easy to use gearshift.

The dual exhaust doesn’t intrude over much, but lends a nice, subtle sound that underlines the engine’s basic differences.

Subaru still says the boxer configuration is still better than a conventional in-line or Vee arrangement because the centre of gravity is lower (moreso in the new model, with the engine mounted 10mm lower than before) and the horizontally-opposed cylinders allow for a much better intrinsic engine balance.

The suspension uses the same basic principles as before too, but the increased use of aluminium helps further reduce weight. Subaru has done a complete re-tune at front and rear, lowering the roll centres and changing the front castor angle for better response and stability.

The steering has been improved through the use of an all-new front crossmember, as well as a new, solid mounting for the steering rack.

Certainly the Liberty is a smooth-riding, quite responsive car – although at this level not a sporting one – with a steering system that is fine for parking but tends to be a tad too light on the move.

The all-wheel drive system is completely unobtrusive until you have need for it – and then it makes you think all cars should be designed this way.

It differs from many all-wheel drive cars in that the system operates constantly, delivering power to front and rear wheels regardless of the circumstances. This means there’s no slight delay - as you’ll generally experience in an on-demand, front-drive biased all-wheel drive - if there’s loss of grip on any of the four wheels.

The Latest Liberty is a better value proposition than before too: standard gear on the 2.5-litre model includes dual front airbags, climate-control air-conditioning, cruise control and a six-speaker sound system with a single-disc CD player.

In terms of active safety (crash prevention) you get four-wheel disc brakes with anti-lock and electronic brakeforce distribution.

The Safety version brings side curtain airbags, front-seat side bags and sunroof, while the Premium version adds electronic stability control (Subaru calls it Vehicle Dynamics Control), power driver’s seat, leather trim, six-disc changer and a cassette player.

The Liberty has been getting it right for some time now, and the new model builds on the same basic, sound foundations. There’s always been a lot of engineering depth here more than ever, the presentation and packaging is doing it justice.