The new engines for the A6 were 1.8 20V I4, 2.8 30V, 1.9 TDI I4, and the 2.5 TDI I5 (140 PS), with the 2.3L I5 engine being dropped on most markets. The S6's 4.2 V8 engine was uprated to 290PS (286hp/213kW) and a new 326PS (322hp/240kW) version was added (S6+ made by quattro GmbH).
Until 1997, the A6 came with several different engines, two of them turbodiesel, and most of them available with Audi's Torsen-based quattro permanent four-wheel drive system. The A6 was also available with saloon and Avant bodies.
The C4 design was available with the following engines:
In 1997 the scene changed strikingly for the A6. With the introduction of an ambitious new design (C5) and a new pack of engines, the A6 moved up a notch and was positioned alongside the hegemonic BMW 5-Series and the Mercedes-Benz E-Class. The Italian redesigned body presented a modern design with a dramatic fastback styling that set the trend for the Audi lineup and gave the relatively large saloon an aerodynamic shell with a low coefficient of drag of 0.28. In 2000 and 2001, the "C5" A6 was on Car and Driver magazine's Ten Best list. This new A6 presented itself with a wide range of engines and configurations. The 30-valve 2.4 and 2.8 V6 engines represented the bulk of the A6's development programme, with a multitude of other engine configurations available throughout the globe. As an alternative to the manual transmission, a 5-speed tiptronic automatic transmission was also available.
The C5 saloon body arrived in 1997, and the Avant body in 1998 in Europe. In the US, the C4 continued for 1997, with the C5 saloon appearing in 1998, and the C5 Avant appearing in 1999. In Canada, there was no Avant (wagon) available at all in 1998 - Audi dropped the C4 Avant at the end of the 1997 model year, and jumped straight to the C5 Avant in 1999 in conjunction with its release in the US. As a result of complying with FMVSS the North American models were equipped with front and rear bumpers that protruded several inches further than their European counterparts, with modified brackets and bumper suspension assemblies as result and child-seat tethers for occupant safety. In compliance with Canadian law, Canadian models received daytime running lights as standard equipment. North American C5 A6 models received the 2.8 litre, 30-valve V6 engine (often referred to derisively as the "2-point-late" given its relative lethargy compared to other A6 engines of the day), the 2.7 litre, bi-turbo V6 (also found in the B5 platform S4), and the 4.2 litre 40-valve V8. The V8 models arrived with significantly altered exterior body panels, with more aggressively flared wheel arches, revised headlamps and grille design (before being introduced in 2002 to all other A6 models), taller and wider wheels (17x8"), larger brakes and quattro as standard.