It is expected that Audi will launch the Q5 in 2008, as a competitor to cars such as the BMW X3 and forthcoming Mercedes MLK.
However, the big news is that another small Audi SUV, the Q3, is also on the cards. The Q3 will probably only go on sale in 2009 and will most likely share its underpinnings with that of VW's new Golf SUV.
Neither the Q5 nor Q3 will be serious off-road beasts and will be more aimed at lifestyle-oriented buyers.
The Q5 will come with Audi's renowned quattro all-wheel-drive system, whereas the Q3 might get a version of VW's 4motion setup.
The vehicles will come with Audi's new TSI petrol engines, which use a supercharger and turbocharger. Naturally there will be a range of turbodiesel powertrains too.
Apparently Audi is also keen on introducing a sporty version of the Q3, which could be badged the Q3S. It will probably feature the same 195 kW 2-litre TFSI engine as the new S3.