2017’s best budget cars

Kia Picanto – From $14,190

The new generation Picanto looks good and comes equipped with automatic emergency braking (AEB), cruise control, a reversing camera, and a big touchscreen that does a lot with your smartphone via Apple CarPlay and Android Auto. The interior design also boasts a lot of character and plenty of visual appeal, even though the materials are rock-hard – much like everything else in its segment.

It’s fun to drive too with sharp steering and a zippy 62kW 1.2-litre engine, which is mated with a likeable five-speed manual gearbox. With a suspension tuned specifically for Australian roads, the Picanto handles exceptionally well for a compact hatch.

There’s only one equipment level, the Picanto S, which comes with the manual gearbox as standard, or a four-speed automatic transmission for an extra $1500.

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Mazda 2 - from $14,990

The Mazda2 is cut from similar cloth to the Picanto, being far more fun to drive than the average city car. Its 1.5-litre engine is very easy on fuel and delivers 79kW in base Neo form, or 81kW in upper-spec variants. Its six-speed manual also has an extra ratio over the Picanto’s stick shifter, and is a delight to row through its H-pattern gate. The six-speed automatic transmission will set you back an extra $2000, and also delivers an enjoyable drive.

Cabin quality and design is another highlight, and the 2 presents its interior with far more panache and style than most segment rivals. Material quality is higher than the Picanto too, though you’d expect that given the Mazda costs more.

AEB is standard on both the hatch and the sedan. Boot space in the hatch (250-litres) is pretty tight, but the sedan holds 440-litres.

The $14,990 base price is the Mazda2 Neo, but spending an extra $3000 on the Maxx manual hatch or sedan brings the slightly more powerful engine, an infotainment screen with reversing camera, digital radio, leather trimmed steering wheel, alloy wheels and automatic braking.

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Suzuki Swift – from $15,990

The new-generation Suzuki Swift also packs a lot of driver appeal into a short, lightweight hatchback, bringing some fun to your commute and handling country drives capably.

The entry-level GL Swift is powered by a 66kW 1.2-litre engine mated to a five-speed manual gearbox. Apart from daytime running lights, the GL is pretty light on features. It’s the only Swift to come with a CD player, in lieu of a touchscreen, and you can stream music from a phone of device via Blutooth. That’s it though – smartphone mirroring and touchscreens are relegated to more expensive models in the range.

Spend an extra $2000 for the GL Navigator and you get a CVT auto transmission, a 7.0-inch touchscreen with built-in sat-nav and Apple CarPlay/Android Auto connectivity, LED daytime running lights and alloy wheels instead of the GL’s steel rims.

If you can stretch your budget an extra $1000, consider the GL Navigator Safety, which gains auto emergency braking, lane departure alert, weaving warning and adaptive cruise control. At $18,990 it’s one of the better equipped city cars.

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Honda City – from $15,990

The Honda City is a light sedan that is based on the Honda Jazz hatchback but with a longer wheelbase and booted bodystyle, which gives it exceptional interior and cargo space for its class. The boot is a cavernous 536 litres, which is better than some SUVs, while rear legroom rivals or shames many sedans from the next size-class up.

The entry-level VTi’s interior is well laid out and the dashboard presentation is neat with most displays and buttons intuitively located. It’s reasonably equipped too, with LED daytime running lights, cruise control, 7.0-inch touchscreen, keyless entry and push button start.

The City powered by an 88kW 1.5-litre four-cylinder engine coupled with a five-speed manual gearbox - CVT auto is a $2000 option. The manual is more fun to drive, but the CVT is agreeable for day-to-day motoring and the City rides well too. While it doesn’t quite match the other cars on this list for outright driver enjoyment it does trump them for interior space, practicality and comfort.