HOLDEN has at last introduced a hatchback that is good enough to take over from the old-shape Astra for segment excellence.

The TS Astra was a small-car superstar, dominating right from its late-1998 launch, and seeing off rivals as diverse as the 2001 Toyota Corolla and original Ford Focus.

However the current AH Astra, introduced in November 2004, has suffered from a noticeable performance deficit compared to its predecessor.

Blame Holden’s decision to carry over the same 92kW/170Nm 1.8-litre four-cylinder engine in a car that is much heavier than before.

This has allowed the Mazda3 and, more recently, Ford’s Focus II to literally and metaphorically zoom past the old master.

Holden isn’t a manufacturer to stand still though.

In fact it has taken two big steps backwards with the JF Viva and TK Barina from South Korea. As the respective successors to the TS Astra Classic and XC Barina neither are nearly as accomplished overall.

Small and light car buyers are not just motivated by cheapness it seems.

So it is with much relief that we can tell you that Holden has taken a huge stride in the right direction with the introduction of the Belgian-built Astra Diesel.

As Gemini aficionados should recall with shame and derision, this isn’t even Holden’s first foray into small-car diesel engines.

Yet the AH CDTi is far and away the best, as well as the most impressive Astra the company has ever offered in Australia so far.

Whisper it... with fuel prices the way they are, the Astra CDTi manual diesel may even be the best real-world new car available for under $30,000.

For one thing, we need to talk about amount of torque it offers.

Australians love torque, and the Astra diesel delivers it by the truckload – 280Nm at 2000rpm for the CDTi six-speed automatic, and – better still – 320Nm at 2000rpm for the six-speed manual model.

The latter’s torque top is the same as the superseded VZ Commodore’s base 3.5-litre V6, as well as the larger of the Golf TDI diesel engine duo that Volkswagen offers (for quite a lot more money).

In the Astra CDTi manual, there is a torrent of torque flowing – mostly smoothly – through the front wheels.

If you press the button labelled ‘Sport’ the throttle response is quickened for a fuller deluge of turbo-diesel thrust.

It is part of what Holden calls it “Sports Chassis Pack”, and it also consists of a 15mm-lower ride height, firmer suspension, and a quicker-14:1 steering ratio.

So be careful on damp or loose surfaces, because you will feel the torque wriggling and writhing via the steering wheel, although not to the extent that it becomes an issue.

The upshot is that, in either mode, indecently quick acceleration and overtaking attack is up for the taking.

Aided by a weighty but defined manual shifter, you will have all the necessary momentum you need to absolutely blitz your way through traffic.

Consider that BMW’s leading 115kW/330Nm 2.0-litre diesel is quieter, while the 80kW/260Nm 1.6-litre Peugeot/Citroen HDI unit is revvier and more economical to boot.

Yet the Astra’s 1.9-litre twin-cam 16-valve four-cylinder common-rail Euro IV turbo-diesel engine is not far-behind either anyway. It also feels stronger than VW’s 103kW 2.0-litre and 77kW 1.9-litre TDI duo.

Believe us, the CDTi manual’s sporty responses will astound you. Its 110kW power peak occurs at 4000rpm.

If you don’t believe us then remember that racy Alfa Romeo uses a similar version in its 147 and 159 JTD models.

Holden’s decision to implement a sportier chassis set up seems to be a wise decision, as it helps overcome the 100kg-plus weight penalty the diesel engine changes bring compared to the petrol-powered editions.

So the Astra’s steering or handling responses actually seem enhanced, with a tiller that responds with a measured and involving precision. Cornering is flat, clean and linear, with plenty of grip and composure over a varied number of road surfaces.

Like all AH Astras, however, there isn’t the level of fluency, intimacy or fun to the CDTi’s dynamics that the multi-link rear suspension-fitted Focus and Golf have.

This is most obvious on snaky roads, as well as in the ride department, where ruts or bumps that are ably absorbed by the others are felt and heard in the Holden.

Holden says the CDTi manual returns 6L/100km on the combined-average cycle (much better than the CDTi auto’s 7.4 and the 1.8-litre petrol manual’s 7.8 figures). We averaged 7.2 over a few hundred kilometres of spirited city and urban driving.

Another CDTi coup is that ESP stability control is standard, adding to the Astra’s impressive bow of inclusive traction control, cruise control, and six airbags – and all for under $30,000.

Holden has also seen it fit to dress the CDTi manual with attractive 16-inch alloy wheels and a very well stocked interior that, with its metallic dash and door-trim highlights, errs on the sporty side.

Other than that the diesel offers the usual AH plusses and minuses.

The cabin is sturdy and well built, offers an excellent driving position backed up by reach-and-lift steering wheel (that is excellent to hold and behold) and driver’s seat adjustments, clear dials, ample ventilation, adequate storage facilities, and an impressive audio system.

Furthermore there is comfortable seating for all four outboard occupants (less good is the centre-rear pew, despite its lap/sash seatbelt and headrest), as well as a fairly accommodating hatchback cargo area that is easily extended by split/fold rear seats.

However the heater/air-con controls are too low down the centre console. The trim is oppressively dark, and not helped by shallow windows, which in turn impede parking, while the Astra’s overall space utilisation seems to ever-so-slightly lag behind some of the competition.

These are all pretty petty points though, because the existence of a powerful, economical and low-emission diesel engine completely lifts the AH Astra out of the shadow of its super-successful predecessor.

Note that the 88kW/280Nm 1.9-litre single-cam 8-vavle CDTi automatic is not nearly as fast, economical or green (recording 192g/km versus 157g/km of carbon-dioxide emissions), but is also worth the extra outlay over the 1.8-litre petrol Astras simply because it also offers six speeds, more performance and better fuel frugality.

We hope Holden also imports the supremely accommodating Astra diesel wagon – it probably deserves a properly punchy powerplant even more than the hatchback does.

As it stands, for a tenner under $30K (or more if you are handy with the haggling), the Astra CDTi is the best Holden small car ever, and something that buyers in this segment simply cannot ignore.

And if you look at it objectively, the diesel manual might just be the best value real-world new car available today.