Citroen is keen to get the message across that its new C2, which goes on sale next week, can offer significant running cost advantages over its main rivals in the supermini sector, and its 1.4-litre HDi engine is leading the charge.

James Parfett, Citroen UK national fleet sales manager, said: 'The fact that we are now able to talk about realistic economy of up to 70mpg in everyday use should open up significant extra opportunities for us with fleet customers.

'Our outgoing Saxo model was an unqualified success in proving that a surprisingly large number of fleets have a need for small cars and the C2 will undoubtedly help us make further inroads in the market.

'I'm confident we will attract more business from the public sector, utilities and government bodies, as well as winning extra interest from user- choosers, nurses and junior staff.'

Speaking at the international press launch of the new supermini range in Paris, he said the manoeuvrability of C2 would be influential with users operating in cities and urban areas.

And he claimed the 108g/km emissions figure achieved by the non-Euro IV 1.4-litre HDi versions will also prove to be a strong factor as customers become increasingly conscious of environmental issues.

Parfett said the fact that the C2 was shorter than the Saxo would make it even better suited to use around town, but added that it is well specified and has a high level of refinement, leading the company to believe it would be useable for all sorts of businesses.

He said: 'Eighteen months ago, Citroen had only one small car in the market. With the C2 joining the C3 and Pluriel, the company is now fielding three entirely different models. The Pluriel has only just come on stream but we are already starting to feel the benefit of offering fleets a wider choice. Last year's fleet sales totalled less than 10,000, but we registered more than 8,000 units in the first seven months of this year.'

Citroen UK managing director Alain Favey said: 'In 1999 the Saxo represented 65% of our sales and left us as little more than a small car franchise in Britain. Now things are different because we have a much wider spread of models. However, we still intend to sell 30,000 C3s, 4,000 Pluriels and 25,000 C2s in 2004. I believe the C2 is so different from its stablemates that it will give us incremental volume.'

The C2 shares its platform and 60% of its components with the C3 and Pluriel, but it has been styled to have a more dynamic appeal through styling such as minimal overhangs.

Despite being shorter, the city car uses clever packaging to provide surprisingly spacious accommodation for four adults – and this automotive Tardis actually beats the 206, Renault Clio and Toyota Yaris in the amount of elbow room it offers for occupants at the front and rear.

Even though it is a late entrant in the sector, the C2 heralds bright new ideas such as individual sliding and folding rear seats and a split tailgate that allows easy access to the relatively commodious luggage area. It also boasts a 'secret' extra compartment in the lower part of the rear door for stowing small items.

Five trim levels – L, LX, SX, Furio and VTR – will be available and there will be a choice of three petrol engines in 1.1, 1.4 and 1.6-litre capacities, plus PSA's economical 1.4-litre HDi common rail turbodiesel.

SensoDrive, Citroen's automated manual transmission with the choice of a gear lever or racing-style steering wheel paddle controls, comes as standard on 1.4 and 1.6-litre petrol versions.

All UK cars will be fitted with electric variable-assist power steering, four airbags, remote locking and a trip computer. Among other big car items available on the range are climate control, automatic headlamps and wipers, cruise control, anti-lock braking with ESP and heated leather seats.

Behind the wheel

It might have been designed for life in the city, but it's clear at the outset that the C2 has been intended to play a far wider role in family and business transport. For a start, the car seats four people in reasonable comfort thanks to rear seats that can be slid rearward to adjust legroom without making too much of a dent in luggage space.

The next striking feature is cabin layout – neat and attractive as well as being purposeful. Its design is a model of efficiency, even though the pimple finish of the plastic may not meet widespread approval.

But the C2's most impressive feature is its demeanour where it matters most – out on the open road. The base 1.1-litre version was not available for us to test but the rest of the range scored top marks for tidy handling, neat manners through the bends and a comfortable ride. Even though it stretches to only 3.66 metres, I'm tempted to think this little car would be equally viable for a 300-mile round trip as it undoubtedly is for commuting or nipping to Sainsbury's.

I liked the liveliness of the 1.4 Furio and 1.6 VTR at high revs, especially as each represents a departure from the class norm in dispensing with the traditional gear lever.

Instead, the mid and top-range petrol models employ SensoDrive electronics in place of a clutch pedal. One of the better of the new crop of automated manual systems, SensoDrive has few drawbacks and looks set to become popular: its great around town and boy racers will love its slick-change steering wheel-mounted paddles. They will also like the sound of the 125bhp VTS model due to be launched in a few months' time.

But if operating costs are of prime importance, the three HDi C2 models will be heading for fleet. Their economy credentials are stunning, they are refined performers and they're terrific to drive into the bargain.

Driving verdict

Citroen surprised itself when it rocketed to supermini fame with hotter versions of the Saxo and that success is set for a re-run with the cheeky C2, a thoroughly competent rival for the Fiesta, Corsa and 206.