The new Fiat Panda is a car of surprises. For a small car it’s surprisingly roomy, and the engine in the version I tested may only be 875 cc and have just two cylinders, but it’s surprisingly nippy.

The new Panda is essentially a city car, but with bags of interior space. Lots of glass makes this small car seem much bigger than it looks. Small it might be, but there’s not a square centimetre of space wasted.

The inside of the cabin is roomy, with a surprisingly large loadspace, and with the seats folded down you get even more space. The squared off rear end means that what it loses in width and length it more than makes up for in height.

The 875cc 85 bhp two cylinder unit is a smooth engine, although it can sound a bit worked at high revs. You’ll also find yourself changing from fifth down to fourth gear m ore often than usual, as revs can die quite quickly. But it certainly feels bigger and more powerful than it is. Plus you get nearly 70 miles to the gallon in mixed driving. The five speed manual gearbox is pleasant to use and precise, and CO2 emissions are very low at 95g/km.

Ride and handling are good, though suspension is a touch harsh, making bumpy roads uncomfortable. Steering is taught and precise.

Equipment levels in the Easy specification which I drove are good. Automatic start/stop (which can be over-ridden), ABS, remote central locking, dual front and window airbags and electric front windows are standard. In-car entertainment is for a small car with a USB port, MP3 compatibility and a very good six-speaker CD sound system.

The cabin layout is very Fiat, with smooth, rounded lines, good materials and lots of storage around the car.

Externally the Panda has a pleasing profile and fun-looking front end. From the side, 14 inch alloys help its well-designed Italian good looks.

It’s difficult to fault this versatile little car. This is a good package for an on the road price of £10,750. The range starts at a very competitive £8,900.

By Ian Strachan