Fiat 500 hatchback

£10,890 - £14,420

The Fiat 500 is a retro-looking city car that recalls the original 500 of the 1960s and follows in the footsteps of other classic-inspired creations including the MINI hatchback and the Volkswagen Beetle. It's based on the Ford Ka and Fiat Panda and is built in the same Polish factory as they are. The city-car class has exploded since the 500 was launched in 2007, and its rivals now include the Renault Twingo, Volkswagen up! and Toyota Aygo. At the same time, the 500 range has expanded to include larger derivatives, such as the 500L MPV and 500X compact SUV.

Fiat facelifted the 500 in the summer of 2015, with the latest models arriving on sale in September. The new model has some small design changes, an updated interior and a less cluttered trim range, too. Other than that, though, it's largely business as usual until the all-new model arrives in a couple of years time.

Meanwhile, there's just one original 500 – a three door – powered by a choice of three engines. The most interesting (and the one we'd recommend) is the two-cylinder 875cc TwinAir turbocharged petrol, available in two power outputs. The 84bhp version returns a claimed 70.6mpg. That figure can be very hard to achieve in reality, but at least this version costs nothing to tax. The more powerful 104bhp version is also free to tax and returns 67.3mpg, while trimming a full second from the 0-62mph time to take it down to 10 seconds flat. Regardless of which version you choose, the TwinAir's distinctive engine note suits the 500 perfectly.

The other engines are a 69bhp 1.2-litre petrol (returning 58.9mpg) and a 1.3-litre Multijet diesel (which returns a claimed 78.5mpg). The 500 has a manual gearbox as standard; an optional automatic costs £750.

The 500's compact dimensions and clever City Steering mode (which lightens the wheel at the touch of a button) make it fun to drive in town. However, it can feel out of its depth on the motorway. Although the 500 is small outside, inside it's actually quite roomy, with space for four adults (at a push) and a decent-sized boot.

The 500 is available in three trim levels as of September 2015, when the facelifted model goes on sale. Entry-level Pop models feature a Uconnect infotainment system with six speakers and an AUX connection, steering-wheel mounted controls and LED daytime running lights in the new halo effect. Pop Star equips air conditioning, heated door mirrors and alloy wheels and 50.50 split-folding rear seats. The top-of-the-range Lounge model has a panoramic sunroof, rear parking sensors, front fog lights and a larger, touchscreen Uconnect infotainment system.

The 500 feels like a quality car, but owners aren't too impressed with its pre-facelift reliability record. Fortunately, it's a reasonably safe car, achieving the full five stars in the Euro NCAP crash tests, albeit under the old, slightly less stringent test programme. The updated model may improve these scores in the future.