Skoda has taken the next step forward. In entry-level trim - priced at less than £8,000 and with equally modest running costs - the Fabia is a bargain. It's spacious, solidly constructed, feels grown-up and is very comfortable and easy to live with. True, the driving experience lacks sparkle, but at this end of the supermini market, that isn't so important. Due to the new model's solid, sensible approach, it fully deserves a five-star rating.

While Skoda's brilliant Octavia hit the headlines for winning our recent Driver Power reliability survey, it was the original Fabia that first set the firm on the comeback trail.

Not only was it a great supermini (we voted it our Car of the Year in 2000), but it was also a big hit with UK buyers. More than 130,000 have been sold here in the past seven years. So, can the new Fabia prove as successful for the Czech marque by moving the game on another step?

We've already been impressed by the 1.4-litre diesel, which we were first to test in the UK last week. Now we've got our hands on the entry-level 1.2 petrol variant, will we have reason to change our minds?

Not if the styling is anything to go by. No radical thought has gone into the design. But the Roomster-look nose is neat and attractive, and crisp lines hint at a no-nonsense personality.

The most noticeable change from the outgoing car is the introduction of black A and B-pillars. Using a styling touch the firm seems to have borrowed from MINI, the windscreen is given a wraparound appearance and quality feel which the matt plastic mirrors and handles maintain.

While the new Fabia appears more grown-up, it's not actually that much bigger than the car it replaces. It sits on a modified version of the same VW Group platform as before, so the wheelbase remains unchanged, while overall length is up by only 22mm - and it's 4mm narrower. It's not the class's biggest car, but Skoda says no competitor has more interior space.

The 300-litre boot is certainly not matched by any rival, while there is plenty of space for at least two occupants in the rear. Equally pleasing is the driving environment, with good seat and steering column adjustment to ensure comfort at the wheel, even if the chairs lack side support.

What really sets the Skoda apart, though, is the quality of its construction. Higher-spec 2 and 3 models get soft-touch dash plastics, yet this basic 1 version still feels tough. Add the generous amount of cabin space, plus thoughtful dashboard design, and it's hard to believe that this car is on sale for less than £8,000.

And this is before you get to the driving experience. Delivering a mere 59bhp, the new all-aluminium High Torque Performance (HTP) engine isn't the last word in horsepower, but the three-cylinder unit is characterful.

It's also remarkably free from vibra-tion and, while not that quiet, has a slick-shifting five-speed manual gearbox. On the road, the Fabia is solid and capable, with fine motorway manners and decent suspension control. However, the Skoda doesn't offer the sense of excitement or fun of class leaders, so it never really comes alive.

Yet this is a small drawback in a car which is otherwise very competitive and great value. After the success of the Octavia in our Driver Power survey, Skoda's new Fabia is proof that despite the competitive price, drivers don't need to compromise on quality.