A thirst for economy

Launched as part of an updated Octavia range, the 1.6 drives with enough enthusiasm to drag it clear of the performance cellar dwellers, despite the engine only boasting 75kW and 148Nm.

And secondly, calling it a fuel economy model is misleading, as according to official figures it is actually the thirstiest engine in the Škoda Octavia line-up.

Mated to the standard five-speed manual, the five-door hatch (dubbed Liftback by Škoda) or wagon consumes 7.8 litres per 100km on the combined scale.

Swap to the $2300 optional six-speed auto and that climbs to 8.3L/100km.

Yet the petrol 1.8 TSI averages 7.2L/100km (m) and 6.7L/100km (a), while the turbo-diesel 2.0 TDI is even more frugal at 5.7L/100km (m) and 6.4L/100km.

Where the 1.6 reclaims much ground is on pricing. At $26,990, the standard hatch undercuts the 1.8 by $4500 and the TDI by $7000. That 1.6 pricing also resets the Octavia entry point $3000 lower, which means it takes on small cars such as the Toyota Corolla and Mazda3 and mid-sized cars such as the Mazda6, Ford Mondeo, Subaru Liberty and Honda Accord Euro.

Octavia shares its vital mechanical underpinnings with the Golf V so no surprise the 1.6 fits straight in. And despite misgivings about its unappetising on-paper specifications, it does not disgrace itself.

It's a basic old lump but also quite strong low in the rev range, a bit scant in the mid-range and then more willing as the revs rise. Albeit noisily.

The claimed 12.3-second 0-100km/h acceleration time for the manual seems fair (the auto claim is 14.1 seconds).

But as long as you are willing to use the throttle and the co-operative gearbox, the Octavia 1.6 bowls along well. With two adults and some luggage on board, the 1.6 coped adequately with the rolling roads of the Fleurieu Peninsula south of Adelaide.

That's not least because it rides and handles so solidly. It steers with certainty – if not tactility- and handles with surety, sliding predictably into understeer. The ride is well damped, dispensing with the lumpy, bumpy test roads efficiently.

It actually rides better than the 1.8 wagon also tested at the launch. This had a firmer set-up, probably because of the lower profile 16-inch rubber.

Otherwise, though, the 1.8 is definitely the better all-rounder, displaying the same solid fundamentals as the 1.6 but with better response from its turbocharged 118kW/250Nm engine.

The newly introduced seven-speed dual clutch automatic transmission is the 1.8's star turn. Mounted transversely and using dry rather than wet clutches, it provides recognisably sharp full-auto operation and the snappiest manual shifts around.

Our real-world drive ended with the 1.8 managing an 8.7L/100km fuel-use average, entirely acceptable for a car with such good performance potential. Škoda actually claims 7.8 seconds for the 0-100km/h dash, which makes it the fastest Octavia in the range apart from the sporty RS.

It backs up its mechanical surety with little-changed exterior and interior designs. While the cabin is dour and unspectacular, it is exceedingly competent. It seems well assembled and designed with care to create plenty of storage capacity. The seats are huge and space is plentiful.

Indeed, a big Octavia attraction is its size. The hatch's boot is 560 litres, while the wagon offers 580 litres. Split-fold the back seat and that grows to 1420 litres for the hatch and 1620 litres for the wagon.

Škoda has capped its revised Octavia package with a simplified engine and equipment line-up. The 1.6 kicks things off with six airbags, stability control, anti-lock brakes, 15-inch alloy wheels, airconditioning, cruise control, power windows and a trip computer. The 1.8 and 2.0 add dual-zone climate-control, 16-inch alloys, six-CD audio, heated and folded power mirrors, front foglights and rain sensing wipers.

The RS and all-wheel-drive Scout continue unchanged, with updates planned for the third quarter.