Hyundai i40

The South Korean car manufacturer's imposing new tourer is going head-to-head with Ford

Hyundai, the Korean car maker, wants to compete on level terms with European and Japanese opposition.

The critics agree that with every recent new model, Hyundai has done exactly that; the cars are well designed, well made, good to drive and inexpensive to buy. What has been missing, though, is a properly competitive large car, a Mondeo rival if you will. That part of the range has been represented by the Sonata, which was old-school Hyundai, not very good and doomed to a twilight role in murky minicab-dom.

Meet, then, the new i40. It has been designed and engineered at Hyundai's German outpost although manufacture is to be in Korea. And as just over half of European Mondeo-class sales are of estate cars, it is an estate car i40 which is to be launched first. A four-door saloon follows early next year.

This is slightly odd. Ford recently withdrew the four-door Mondeo from the UK market because no one bought it. Nor is there a four-door Vauxhall Insignia. However, Peugeot (508), Toyota (Avensis) and Volkswagen (Passat) have popular four-doors. Besides which, the i40 estate car is as much a roomy hatchback as a practical estate, with its rising waistline and racily sloping tail.

Anyway, this new i40 is an imposing-looking car. The headlights contain hook-shaped strips of LEDs which glow white in daylight, and the tail looks assertive and expensive with its squat stance, its strip of chrome between the lights, and its spoiler above the window. Inside, too, it comes across as a thoroughly designed, high-quality creation, if not quite to the "premium" levels of an Audi or a BMW. Among the car-makers outside the charmed circle of "premiumness", only Peugeot has truly captured that ambience with its new 508.

That said, the two i40s I tested were not quite the final production article but rather were late development cars. There may be small differences in interior finish by the time the cars reach the showrooms, but even as they are now they are very habitable. There's much pretend-aluminium detailing, and a key improvement would be to chromium-plate the door handles and make them feel metallically cold.

However, the instruments and displays are crisp-looking and sophisticated in their graphics, and there's the full gamut of the equipment expected in a modern car of this class. Interesting options include cold-air venting of the seats as well as the usual heating function, a heated steering wheel and an "auto de-fog" system. Headlights that illuminate round corners, a lane-departure warning system, reclining rear seats, automatic folding of those seats, and movable bars and dividers in the boot are also offered.

There are 1.6 and 2.0-litre petrol engines, of 135bhp and 177bhp respectively, but the bigger sellers will be the 1.7-litre turbodiesel engines of 115bhp or 136bhp. This last has power to compete with some other manufacturers' 2.0-litre units, and beats them on CO2 emissions: 124g/km, or just 119g/km with the optional stop-start system. A six-speed automatic transmission, with paddle-shifters, is optional on the two most powerful i40 engines.

Sounds promising so far. The i40 GLS diesel I drove wore 18-inch wheels (these and 17-inch items are options, 16-inch is standard) but used the more "comfortable" of two suspension settings being considered for production. The big wheels made ridges and bumps more obvious than they would otherwise be, but otherwise the i40 rode well with a pleasing flow through corners and a smooth, accurate, natural response from the hydraulically-assisted steering – a system easier to make feel "right" than an electric one. The 2.0-litre petrol i40, by contrast, had firmer suspension but 17-inch wheels, a combination less successful at insulating road commotion. The diesel's suspension settings and the 17-inch wheels would make the i40 handle as well as its better rivals, so I hope Hyundai signs off such a mix for production.

And the engines? The petrol engine felt lively and smooth enough, and it gives the best pace of the range with a 9.7-second 0-62mph time, but the 136bhp diesel is clearly the engine to have. It pulls with the vigour of most 2.0-litre rivals and stays acceptably quiet while doing so, sipping very little fuel in the process. Cruising in sixth gear is quiet, the gearchange is light and easy, the brakes pull you up firmly. And there's plenty of space.

This is a car as capable as anything from other mainstream car-makers, and at a usefully lower price – about £19,000 – complete with a five-year warranty. I can't see how it can possibly fail.