The new Grand Cherokee is a big step forward for Jeep. Thanks to new construction methods and technologies implemented by Italian owner Fiat, build quality is better than ever – although it still can’t match class leaders. It’s luxurious on the road and equally rugged off it, which should be enough to convince buyers who want genuine all-terrain ability without sacrificing everyday comfort.

Back in 1992, Jeep claims to have invented the luxury SUV, with its Grand Cherokee. But these days, the flagship car is hardly a trend-setter, with rivals such as the BMW X5 making it appear unsophisticated.

Now, with guidance from the Fiat Group, Jeep is aiming to revive its fortunes in Europe with this all-new model. And we’ve driven what’s expected to be the biggest seller – the 3.0-litre V6 diesel.

It uses the Italians’ fuel-saving MultiAir technology to return 34mpg and emit 218g/km of CO2. Plus, it’s punchy on the move, sprinting from 0-62mph in an impressive 8.2 seconds. The new Grand Cherokee can’t quite match the likes of the VW Touareg for refinement, but it’s a real step forward for Jeep – engine noise is only noticeable under hard acceleration.

It rides well, too, and the soft suspension helps to soak up bumps in the road easily. Top-spec models get an air-suspension system, which can lower or raise the body depending on driving conditions.

The steering is geared more towards comfort – light, but short on feedback. Corners aren’t the big SUV’s forte, and body roll is marked if pushed too hard. There’s a reassuring level of grip, though.

Where the Jeep is really at home is off-road. We took the big Jeep through a punishing route of near-vertical inclines and drops, as well as deep fords, and the newcomer never missed a beat.

But despite its rugged off-road ability, it looks similar to any other 4x4. While the new design is crisp and stylish, it’s still recognisably Jeep, with the trapezoidal wheelarches and seven-bar grille.

Inside, everything is well put together, although buyers may be hoping for better-quality materials in some areas – only top-spec Overland models get a leather-covered dash. And despite costing £38,000, our basic Laredo version didn’t come with leather seats as standard.