It may be small, but it's definitely perfectly formed

Price: £6,500 (for the five-door as tested)
Engine: 1.0 litre, three-cylinder, 59bhp
CO2: 114 g/km
Performance: 99mph, 0-60 in 12.2 secs, 58.9 mpg
Worth considering: Fiat Seicento, Ford Ka, Daewoo Matiz, Peugeot 106

Forget your flashy luxury flagships or envelope-pushing supercars, in the car world there is no more noble achievement than to build a truly excellent small car. These days few companies bother to try. Diahatsu has not only tried, it has excelled with the new Charade.

Despite having a mere 1.0 litre, three-cylinder engine up front, the Charade is a perky little performer, with ample zip for speedy traffic-light getaways and comfortable motorway cruising.

Okay, if you hurl it into corners it will understeer to kingdom come, but no real-world Charade user is likely to do that. Instead, they have a well-made interior, massive interior space and Tokyo-cool styling to appreciate, as well as a supple ride.

And when you start up every morning, it greets you with the words "Hello, Happy", illuminated on the dash. A simple gimmick, but to me it was worth the equivalent of air-con on any other car simply because it made me smile every time (incidentally, the five-door Charade we tested comes with air-con, air-bags, anti-lock brakes, power steering, alloy wheels, electric windows and a CD player as standard).

Usually, when we test budget cars like this, I am a little anxious before ringing prospective testers, conscious that most would, naturally, love to try an Aston Martin or some such. But I need not have worried with the Charade. Most of our testers loved it and even the, "I wouldn't say I hated it", from Ms Craig is still not bad when one remembers she normally drives an A6.

Liz Craig, 56, health service manager, from Stockport, Lancashire
Usual car: Audi A6

"I wouldn't say I hated it. It was nippy and very good in traffic, but it wouldn't be any good for the distances I travel. It is more for local shopping trips and things like that. I wouldn't feel confident in it on a motorway. It felt well-made, and it is good value for what it is. It will appeal more to women than men, and probably middle-aged women, though it does have room for a family. If I was buying a car this size I would probably go for a Fiat. I'm not keen on the shape; it is very unsexy, but I suppose that's not the point with a car like this. And the boot is awful because they have concentrated on more leg-room in the back."

Pauline Mitchell, 68, councillor, from Manchester
Usual car: Nissan Almeira

"I liked it; I was agreeably surprised. It is 100 per cent better than a Daewoo and not at all tinny, like Fiats tend to be. The seat holds you well, you feel comfortable and secure, and considering the size of the engine there was enough oomph. There was plenty of head and leg room, but I still don't know whether I would like such a small car. You do sit very low. I liked the four doors, and there were no blind spots. The Diahatsu badge would not bother me, and it is more of a woman's car, possibly more of an older woman's car, for someone who doesn't need to carry much stuff with them. After all, who do you know under 30 would be seen dead in a Diahatsu?"

Helen Hartley, 31, nurse, her husband Alistair, 33, engineer, and their son Samuel, 4, from Cleckheaton, Manchester
Usual car: VW Bora

Helen: "I usually have problems in cars because I have a bad back but this was comfy and well-cushioned. It looks good, there's lots of room and it is well-equipped. The power steering and turning circle are great. It's cheap. I have doubts over it as a motorway car. You don't feel safe."

Alistair: "I was pleasantly surprised. It's got more room in the back than a BMW I was in, and it has air-con and a CD player. I could get used to the looks, but the small boot would be a problem for anyone with kids."

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