Fiat's skill in small car making is the very foundation of the company. From the pint-sized 500 through to the latest Panda Fiat has always made good small cars and sold them by the millions. The old Punto was a good enough car but found itself swept away in a deluge of talented rivals. The new Punto has some ground to make up, at the same time as maintaining the original car's value-for-money ethos.

Things get off to a great start as the exterior of the Giugiaro-penned Grande Punto are fantastic. From the mini-Maserati nose treatment to the bluff and squat rear end the car looks great. From almost every angle it is pretty and there are details to drink in and focus on. The profile has shades of Alfa Romeo and the bulging arches add menace to the stance. The Sporting trim of our test car further added to the style with 17-inch alloy rims and subtle spoilers and skirts.

Once inside the cabin the quality immediately impresses. A wide variety of textures and materials break up the larger surfaces and work well, as well as looking good. The carbon effect dash in particular is an effective way to add interest to what could potentially be just a large slab of plastic. The seats are comfortable with a good range of adjustment in the front.

There is plenty of head, elbow and leg room in the front and rear. As with most superminis you wouldn't ask tall friends or family to spend extended periods in the back. The boot is also a good size, including a sub-level beneath the floor, with the standard folding rear seats affording generous load carrying ability. All in all the Grande Punto has enough space to live up to the name.

A leather trimmed steering wheel is standard on the Sporting and is heavily sculpted for grip around the quarter-to-three position and is nice to hold. It's a nice size as well and is good to use, although the steering lacks weight in normal mode, whereas the "city" function makes it literally finger light. Even the most frail of driver would be able to steer the Punto at low speeds, but some will bemoan the lack of feeling and weight in the helm when pushing on a bit.

The dashboard works well with the black on white dials of the Sporting being clear and easy to read, as well as adding a sporting overture in tandem with the carbon effect backing. The gear knob and handbrake are also leather trimmed and leather trimmed seats are optional. Standard equipment on the Sporting is generous with full electrics, air conditioning, CD changer and a raft of active and passive safety devices.

There are a couple of ergonomic 'anomalies' reminiscent of Italian cars of old. The footrest is about six inches too high meaning that the driver's leg is bent awkwardly if the rest is used. Also Fiat persists with the horizontal scrolling on-board computer interface on the dash. It is infuriatingly slow to skip between the various options available. Rivals do that bit better.

Up front the now familiar 1.9-litre MultiJet common-rail diesel engine, here in 130bhp form, does a fine job of helping the Sporting live up to its name. Peak torque of 207lb.ft is available at just 2000rpm and makes the Punto a deceptively quick and muscular small car. In-gear thrust is very impressive and real world performance is much quicker than the 9.5 second sprint to 62mph suggests.

The six-speed 'box is quick and slick and the ratios are well spaced to allow for good performance combined with comfortable and refined cruising. The fuel consumption isn't as miserly as some less sporty competitors; we managed 32mpg overall during our week but cruising economy in the high 40s is easily obtainable.

The Punto badge itself makes a promise of driving involvement courtesy of the clever treatment of the letter 'P'. In practice, the handling is fun and sharp, although the relatively large diesel engine does make it feel slightly nose heavy at times. There is plenty of grip and good body control without compromising ride quality too much and the brakes are strong and dependable. Though there is the option of a lively 1.4-litre petrol engine with the Sporting package, we reckon that this chassis could easily handle more power.

Overall the Fiat Grande Punto is a very impressive small car; stylish, practical, comfortable, fun and all the other things buyers of small cars want. Building upon the success story of the new Panda Fiat scores another hit in its traditional core discipline, small cars. For many the looks and style alone will sell them the car; the good news for others who delve below the skin is that the Punto can live up to the promises made by its pretty face. The Punto may not be the very best supermini in any one area, save maybe for appearance, but it scores heavily in enough disciplines to compete with the current class leaders.

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Fiat Grande Punto 3-door UK range overview

- Fiat Grande Punto 1.2 Active White: £7,489
- Fiat Grande Punto 1.2 Active: £7,989
- Fiat Grande Punto 1.2 Dynamic: £8,895
- Fiat Grande Punto 1.4 Active Sport: £8,895
- Fiat Grande Punto 1.3 16v MultiJet 75 Active: £8,895
- Fiat Grande Punto 1.4 Dynamic: £9,195
- Fiat Grande Punto 1.3 16v MultiJet 90 Dynamic: £10,595
- Fiat Grande Punto 1.4 16v Sporting: £10,695
- Fiat Grande Punto 1.9 MultiJet 130 Sporting: £12,295