The trickle-down theory may be a debatable economic policy, but for vehicle manufacturers the essential concept is basic practice, with newer and more expensive technology entering the market on a company’s higher-priced vehicles and later trickling down to lower-priced models. The 2018 Volkswagen Tiguan, Passat, and Beetle are the latest beneficiaries, with all three models benefitting from a new base turbocharged 2.0-liter four-cylinder engine that debuted exclusively in the front-wheel-drive Audi A3 and the Audi A4 Ultra last year. Internally known as the Gen3.B, the updated engine is a development of Volkswagen’s venerable EA888 turbocharged inline-four.

Although the Gen3.B’s intake valves close earlier than is typical of a Miller-cycle engine, the general principles remain. Compared to the Gen3 2.0T, the Gen3.B’s added fuel efficiency comes at the expense of horsepower and torque. For instance, the Audi A4 Ultra’s EPA fuel economy figures of 27 mpg city and 37 mpg highway better those of the A4 2.0T by 2 and 4 mpg, respectively; however, the Ultra’s 190 horsepower and 236 lb-ft of torque are down by 62 hp and 37 lb-ft compared to its 2.0T equivalent. Due to small tuning differences including a diet of 87-octane, the Gen3.B in the 2018 Tiguan produces only 184-hp and 221 lb-ft of torque, a loss of 16 hp compared to the 2017 Tiguan, but a gain of 14 lb-ft.

While we weren’t given the opportunity to put the new Tiguan through its paces on tarmac, Volkswagen did set us loose at Bundy Hill, a privately owned off-road recreation park in Jerome, Michigan. With a set of Pirelli Scorpion Verde all-season tires wrapped around its 19-inch wheels, the all-wheel-drive prototype lacked the rubber necessary to tackle Bundy Hill’s tougher trails. Still, the compact crossover managed to hold its own as it climbed steep inclines and plowed through mud and muck. With little turbo lag and plentiful low-end torque (the Tiguan’s torque peak starts at 1600 rpm and stays strong until 3940 rpm), the Tiguan never felt overwhelmed as it seamlessly pushed the engine’s power to all four wheels.

After Bundy Hill, we experienced the Gen3.B engine on-road in a 2018 Volkswagen Passat prototype. While Volkswagen remains mum on horsepower and torque figures for 2018 Passat and Beetle models equipped with the Gen3.B, we expect output to mirror that of the Tiguan. If this holds true, then the four-cylinder 2018 Passat and Beetle will see gains of 14-horsepower and 37 lb-ft over the 1.8T engine it replaces in these models. As in the Tiguan, the Gen3.B in the Passat stood out for its torque-rich nature that allowed the front-wheel-drive family sedan to move off the line with authority. Unlike the Tiguan, the 2018 Passat and Beetle continue to rely on a six-speed automatic; a manual transmission is no longer offered.

Although the EPA has yet to release fuel economy figures for 2018 Volkswagen models equipped with the new engine, Volkswagen anticipates that the Passat will be approximately 8 percent more efficient than its 2017 equivalent. That would suggest the four-cylinder 2018 Passat will bear a combined fuel economy figure of 29 mpg, putting the German sedan on equal footing with other four-cylinder mid-size sedans such as the Hyundai Sonata, the Mazda 6, and the Subaru Legacy.

With the arrival of the EA888 Gen3.B engine, the 2018 Beetle, Passat, and Tiguan are the recipients of an engine that’s substantially torquier and more fuel efficient than the units found in their respective 2017 counterparts. In economics that’s called a win-win.