Honda has developed many applications for its clever VTEC (Variable valve Timing and lift Electronic Control) system, but the configuration employed in the Prelude is the most stimulating. Using two sets of cam lobes per shaft - one set placid, the second aggressive - the hydromechanically activated system engages the second set of lobs at about 5200 rpm.

The 5-speed gearbox is precise, although the gear ratios aren't quite as close as they were in the previous VTEC-powered Preludes. Compared with some of the newest sport coupes, the shifter feels a little long.

The optional automatic transmission is a four-speed Sequential SportShift. It allows the driver to shift manually as well as operate in full automatic mode. Similar in concept to the Chrysler AutoStick and Porsche Tiptronic, it adds more driving fun to automatic editions, but also adds weight and cost and subtracts from the all-around performance. While 5-speed Preludes rev to an exhilarating 7000 rpm, AutoStick models rev to an almost as exhilarating 6600-rpm redline; as a result, AutoStick comes with 195 horsepower and the same amount of torque. (AutoStick is not available with the Active Torque Transfer System.)

Honda significantly increased the rigidity of the Prelude when it was redesigned in 1997. This improvement is all the more remarkable given the previous body shell was already one of the best in its class in terms of stiffness; chassis rigidity is a key element to greatness in ride and handling. Honda's painstaking work with the chassis is immediately apparent in hard cornering. Transitions are crisp, steering responses scalpel-sharp.

The biggest decision when buying a Prelude is whether to shell out the extra $2,500 for the Type SH, which comes with Honda's Active Torque Transfer System. You have to drive the car quite briskly to experience the benefits of the system, which is transparent during normal driving conditions. One the one hand, this system can best be justified by an enthusiast who loves winding roads. On the other hand, it benefits drivers with average skills more than those with the skills of a Juan Montoya. Turn the steering wheel and the car will go where it's pointed.

The Prelude has always served as Honda's technological showcase and this is most obvious in ATTS, as it's called. This system moves front-drive performance cars another step closer to parity with their rear-drive competitors in terms of absolute handling. Here's how it works: When a front-drive car hustles around a corner, its front tires have to transfer power to the ground as well as steer the car. That - plus the pronounced forward weight bias that goes with having all the powertrain stuff up front - is why front-wheel-drive cars such as the Prelude are more prone to understeer than rear-drive cars. Automatic Torque Transfer makes the car easier to drive quickly and helps reduce understeer. (Understeer describes a car's resistance to turn-in. The faster the entry speed to a given corner, the more the car wants to go straight ahead.) ATTS addresses this trait through a clever set of mechanical functions that automatically transfers engine torque to the outside front wheel, while increasing its rotational speed. Transferring as much as 80 percent of the power into the outside front wheel, which typically bears the heaviest load in hard cornering, compensates for the extra load and restores balance. The effect is sometimes compared to that of a bulldozer, which can turn the right tracks faster than the left tracks when it turns left. It's a clever Honda solution to a problem no one else has really managed to solve - and it works.