Hyundai i10 1.0SE

It cost less than £7,000 and it bore the badge of Hyundai, the Korean firm that was starting to grab attention through its value for money offerings, generous equipment levels and five-year warranty.

That car was the Hyundai i10, which went on to become the best-selling car under the Government's scrappage scheme, with buyers swamping dealerships to trade in their older, polluting cars in exchange for the safer and economical newcomer. Hyundai, more than any other car maker, benefited from the old adage "where there's muck there's brass".

More than 22,000 i10s found homes in the UK in 2009 and it became the eighth best-selling car nationwide.

Fast forward to this year and Hyundai has launched what it calls the New Generation i10. If the previous version was Hyundai's baby city car, then this new one has grown up.

Or rather, it is now the longest and widest city car on sale.

You get a decent sized boot for starters with a broad floor area that accommodates a medium-size travel case flat, where rival cars’ boots might force you to stand it up or lie it on its side.

The spacious cabin is dominated by a huge, full-width coloured panel on the dashboard in a choice of orange or blue, with beige restricted to the entry-level S model and red kept only for the Premium grade.

My test car, in Montano Sky light blue with the matching blue dashboard was easy on the eye, and there's a definite aura of quality as you sit behind the wheel.

Cup and bottle holders abound, the glove box is broad and deep and the ergonomics are top notch.

As standard, the entry-level S Trim (starting at £8,345) gets Daytime Running Lights, central locking, electric front windows, USB with AUX connection and a host of safety equipment including Electronic Stability Programme (ESP), six airbags, Tyre Pressure Monitoring and Vehicle Stability Management (VSM).

Moving up to the mid-range SE trim, buyers get electric rear windows, body coloured door handles, electric and heated door mirrors, air conditioning and driver’s seat height adjustment as standard. Prices for these models start at £9,295.

The Premium trim adds LED daytime running lights, integrated door mirror indicators, steering wheel controls, Bluetooth with voice recognition, leather steering wheel and gear knob and 14-inch alloy wheels over the SE models. Prices begin at £9,995 for the Premium trim derivatives.

There are two engines available in the UK. A familiar 1.2-litre four-cylinder engine is the range-topper and the more expensive option, but the new three-cylinder 1.0-litre unit , tested here, steals the show. It’s gutsy at typical engine revs and with its characterful background buzz and tractable, flexible manner it has to be the engine of choice.

Keep the revs low, and even at 50mph the cabin is surprisingly hushed. This is the smallest car Hyundai makes, remember, and even if it is bigger than the rivals it definitely sets new standards for interior noise levels.

The previous 1.1-litre engine was willing, but this new three-cylinder unit is a joy. It is also matched to a gear lever that no longer feels weedy.

In a city environment, it is in its element, providing a supple ride in a slightly raised position. But I also found it to revel in country road runs at 60mph.

The new i10 is an excellent car, but for reasons that differ from the first-generation model. It's a transformation rather than a refresh, a more composed offering that should have much wider appeal. There will be those that mourn the loss of the dinky dimensions, but the game has moved on and the i10 can now rightly claim to be an all-rounder and still at a bargain price.

At a glance

Hyundai i10 1.0SE

Price: £9,295

Engine: Three-cylinder 1.0-litre petrol, developing 66PS

Transmission: Five-speed manual

Performance: 0 to 62mph in 14.9 seconds; top speed 96mph

Economy: 60.1mpg combined

CO2 emissions: 108g/km