Fiat Panda

The new Panda is easy to drive, refined and likeable. With decent accommodation in a basic but well laid-out interior, the Fiat sets new class standards. It's also well built, robust and, most importantly, is priced very competitively and has cheap running costs. In fact, it's a bargain.

The Panda has returned to Britain. No, not the bamboo-chewing variety, but Fiat's latest incarnation of its urban runabout. Famed for making affordable, functional and well designed small cars, the company hopes that its new Panda will be the model which revives its fortunes in the UK.

Designed to set improved standards for quality, refinement and equipment in the sub- £10,000 market, it will provide bargain-price transport. The newcomer is available with a choice of 1.1 and 1.2-litre petrol engines, with a 1.3-litre MultiJet diesel version scheduled to arrive in the spring. Prices start at £6,295 for the 1.1-litre 54bhp Active, although the perkier 60bhp 1.2-litre model available in Dynamic or Eleganza trim levels is sure to be a more popular choice.

With only 60bhp, performance is hardly startling, but the four-cylinder unit is refined, while the sharp throttle response makes the Fiat feel reasonably nippy around town. But unlike the last-generation model, this Panda can cruise happily at motorway speeds and also boasts impressive stability. The five-speed gearbox is slick and the controls well weighted, while refinement is a step ahead of rivals with road and engine noise well insulated.

Fiat has also made a good job of the suspension, because the ride quality is decent and the handling is well mannered, with no nasty surprises in store. What's more, all Pandas except the entry-level version come with ABS and Brake Assist as standard.

As you would expect from a non-sporty model, there is a touch of body roll to warn drivers against throwing the car about too much, but the electric power-steering provides adequate feedback. There's also the advantage of the 'City' button which, when pressed, allows finger-light steering for tight parking manoeuvres. It's good news inside too, where the Panda is big on space and offers plenty of head and legroom. While it's strictly a four-seater, the car accommodates adults in reasonable comfort. The rear bench can be slid forward to increase boot space - although this reduces legroom - and the back seats split and fold.

However, the lack of an internal or external boot release is a real pain, as the key always has to be used to gain access. But with comfortable, supportive seats, a rake-adjustable steering wheel and neatly placed gearlever, the driving position is well thought out.

What's more, a steeply raked windscreen, thin A-pillars and large windows ensure excellent visibility and an airy cabin. There's not much to look at, of course, since this is a budget car with a minimum of equipment, but it's well built. With all the switchgear clustered around the gearlever, everything is within easy reach of the driver and simple to use. In short, the cabin is a winner and sets new class standards.

Priced at £6,895, the Dynamic version adds body-coloured bumpers, a rev counter and ABS over the base Active. There's also the option to choose upgraded Dynamic spec models, with goodies such as air-con, roof rails, remote locking, a CD player and sunroof. The £8,095 Eleganza has kit not normally seen in this class, including climate control and 14-inch alloys.

And with a group 2 insurance rating plus CO2 exhaust emissions in the lowest bracket, the Panda should also be surprisingly cheap to run.