One of the main safety criteria of a passenger car is the accurate and stable lateral response of suspension system in severe handling manoeuvres. This behaviour can dramatically change as a result of compliances in mountings of suspension system. In other words, alteration in suspension alignment dimensions, as a result of handling forces in a cornering manoeuvre, can change rear axle installation angle and consequently it negatively affects lateral stability and understeering behaviour of car. In this research, this defect is investigated in an available passenger car and behaviour of the system is improved by optimising stiffness and installation angle of bushings of rear axle. It is noteworthy that although stiffening axle bushes can increase lateral stiffness of rear axle it is a matter of trade-off between ride and handling performances of vehicle. Hence, considering the inclination angle of bushing axis along with its stiffness in different directions can attenuate the mentioned drawback.In order to perform the optimisation process, finite element model of the rear torsion beam axle is generated and the super-element model of it is transferred to ADAMS/Car software. The developed full vehicle model is validated through handling manoeuvres. Parameters of interest for optimisation purpose are bushing inclination angle and rubber stiffness in different directions. The optimisation is performed by virtual analysis in ADAMS/Car and the proposed configuration for the bushing is applied to the rear axle prototype and performance of the modified axle is investigated through experimental track tests on the reference car.