In this paper, we present a flexible conceptual model for product family engineering. The conceptual model takes advantage of the new expressiveness and precision of UML 2.0. We also present some simple additions to UML to provide efficient modeling of system families. The conceptual model is used as basis for modeling system families at different abstraction levels and for performing semi automatic product derivation in alignment with the structure and philosophy of the Model Driven Architecture (MDA). The paper also presents how a tool can facilitate the product derivation. In summary, we describe how the MDA approach might be concretized in a system family engineering context.