Perhaps harder to visualize than oversteer, understeer is where the front of the car tends to push towards the outside of a curve. This is the opposite of oversteer, and is difficult to understand intuitively. Oval racing fans call this 'tight' handling, and while it does not tend to cause crashes, it tends to slow the drivers down a fair bit, as they constantly fight the wheel to keep the car on the curve.
Northern residents are perhaps the most familiar with understeer from driving in icy conditions; that awful sensation you get from turning the wheel and finding the car keeps going in a straight line! This is understeer at it's worst - the complete loss of front-wheel traction. Understeer is commonly referred to as a 'push' (with the car 'pushing' into the turns) perhaps because it seems like something is shoving the front end of the car away from the desired turning line.
FWD cars tend toward understeer partly because of the location of the drive wheels, and partly by design - understeer is considered an easier condition for the average driver to handle. AWD cars are usually based on FWD platform, so they inherit the basic handling characteristics, including understeer. Both FWD and AWD DSMs tend to understeer a lot, a constant annoyance to those drivers wishing to corner quickly.
You can also check out What is oversteer?
Those interested in handling will find Dennis Grant's Far North Racing site a must read.
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