Car-based SUVs such as the Lexus RX300 use independent rear suspension to provide the ride and handling customers expect, but GMC has managed to give the Yukon those benefits without compromising its cargo-carrying utility. A new five-link independent rear suspension contributes to better ride and handling than any vehicle in this class. The front suspension is conventional in design, except for the springs. To save space, the Yukon uses torsion bars instead of coil springs. The Yukon's conventional ladder frame is fully boxed in the mid-section for maximum rigidity, while the front and rear portions are shaped by the same hydro-forming technique used to make Corvette frames. This design is a key to the Yukon's excellent ride and handling. At the very front of the frame is a section that is designed to crush and absorb impacts in a crash.

The premium ride suspension helps keep the Yukon level over bumps. This effect is especially pronounced when towing; a trailer tends to cause the towing vehicle to rock back and forth when driving over bumps, but the premium ride system keeps the Yukon amazingly smooth.

The recirculating-ball steering provides good control and feedback, even if it falls short of the rack-and-pinion steering found on the Ford Explorer and in many sports cars. Yukon's power steering system is designed for durability by operating at a lower temperature range. A much-tighter 38.3-foot turning diameter makes the Yukon easier to park than before.

The rear axle now carries dual-piston brake calipers for its disc brakes. Along with bigger front discs, the new Yukon enjoys a much-needed upgrade in the stopping department. The upgraded brakes perform nicely. As a test, we towed a heavily laden horse trailer without trailer brakes connected and were impressed with the braking ability. A dynamic proportioning system continuously balances the front and rear brakes for maximum braking without activating the ABS.

Under the hood, the Yukon employs the latest version of Chevy's small-block V8 engine family. These Generation III overhead-valve engines are the best yet and rival competitors' overhead-cam engines for smoothness and efficiency. The new 4.8-liter version cranks out 275 horsepower, which is 20 more than the old 5.7-liter motor. At the same time, it is quite efficient: the 2WD 4.8-liter version, for example, earns 20 mpg on the EPA's highway mileage test. The tested 5.3-liter engine is rated at 285 horsepower and its acceleration performance is impressive. Like the 4.8-liter engine, the 5.3-liter burns regular unleaded fuel, making pit stops a little more affordable.

The tested two-wheel-drive Yukon offers a limited-slip rear differential to give drivers better traction in slippery conditions. More clutch disks than before mean smoother engagement of the differential lock. An available traction assist (not quite true traction control) cuts engine power as needed to help maintain traction to the rear tires. A second-gear winter start feature in the automatic transmission also helps get the Yukon rolling without wheel spin under slippery conditions. These two systems make the 4x2 Yukon sufficient for all but those who live at the end of long driveways in snowy climates.

All Yukons are equipped to accept a lighting plug for trailer towing, and have provisions for connecting a trailer brake controller very easily. They also have a deeper oil pan on the transmission to provide a better supply of cool transmission fluid while towing. Our Yukon equipped with the towing package included a receiver hitch and an external oil-to-air transmission cooler. GMC says the cooler is unnecessary, but that customers who tow install them universally. Cool transmission fluid is vital to transmission life, so they figure better safe than sorry.