Toyota Aygo

It's stretching the point to call the Aygo groundbreaking, but Toyota's promise to introduce new engines and specs throughout the car's life is exciting. The model is undeniably capable, especially around town, well built for such a cheap car and the base variant is great value. But Toyota has missed a trick by failing to make the cabin more versatile.

Small is big news this year, so it's no surprise few cars are as eagerly anticipated as Toyota's neat little Aygo. Unveiled at last month's Geneva Motor Show along with its sister cars, the Citroen C1 and Peugeot 107, Toyota says the Aygo will change the way drivers think about commuting when it goes on sale in July. To see if the reality lives up to the hype, Auto Express hit the road to become the first magazine to test the car.

There are three variants - Aygo, Aygo Plus and Aygo Sport - and prices are set to start at about £6,800. Although it shares more than 90 per cent of its components with the C1 and 107, the Toyota's external design is the most striking of the three. The rear lights are housed in bulbous pods, while the angular headlamps and large badge in the centre of the grille give it more character than the manufacturer's other small cars.

The cabin, bar the badging, is common to all three new models, and is simple and logically laid out. Highlights include a panel for the ventilation system on the centre console, which glows orange when the lights are on.

At 3.4 metres in length, the Aygo is 20cm shorter than the Yaris, but doesn't feel that way from the driver's seat. While tall passengers in the two rear seats will struggle for kneeroom, there is at least plenty of space to tuck their feet under the front chairs.

Even more impressive is the build quality. For a budget product, the car has an extremely upmarket feel. The dash is made of decent-quality plastic, the shutlines are ruler-straight and panel gaps minimal. But it's a pity the rear window doesn't wind down. Instead, a clip and hinge let it open by only a couple of centimetres.

Another disappointment is the lack of a sliding rear bench, which would allow boot and rear-seat space to be adjusted. As it is, there's about enough room for one big suitcase in the load bay. But because the rear window is also the bootlid, the lip is high and it's obviously been designed more with the weekly shop in mind than a family of four's holiday luggage.

The 1.0-litre engine is straight from the Daihatsu Sirion and trumpeted as the lightest production car engine on the road. And it's the 61.4mpg economy figure Toyota claims for the combined fuel cycle that will be of more interest to buyers than the 67bhp which the powerplant generates.

As a cheap and cheerful means of nipping around town, the Aygo is excellent. The light, airy cabin offers great visibility and the speed-sensitive power-steering works well. On the road, the little car feels solid and, thanks to the short overhangs, it handles corners at speed confidently.

The new Toyota is a worthy newcomer and not just because of its low asking price - running costs are minimal and the firm hopes it will be rated for the lowest insurance group.

A diesel is due next year, and Citroen and Peugeot launch their models soon. Budget cars from Kia, Chevrolet, Hyundai and Daihatsu beware - city drivers have never had it so good.