FIRST things first.

It may be made in South Korea (“built at GM’s world-class Gunsan plant”, says Holden), and there is a Daewoo version called the Lacetti Premiere.

But the all-new JG Cruze sedan is an Opel/Holden engineered small car, devised at its development home room in Russelsheim, Germany, where it has been twinned with the next-generation Opel Astra that we may or may not see in Australia later in 2010.

Memories of the sub-standard Holden Viva should be cast aside completely then, and even though we are still living with Holden’s old Daewoo ‘legacy’ models such as the equally unappetising Barina and Epica, the Cruze is a much, much better car for being a new-from-the-ground-up Opel development.

And while it simply does not match the overall thoroughness of the latest Mazda3, and won’t put a smile on your face like a Ford Focus can, this car embarrasses the opposition in its value-for-money pricing, and stands tall thanks to its ANCAP-endorsed five-star safety across the range.

For some, the Cruze will then seal the deal simply by being slightly larger and roomier than most four-door sedans in its segment, while others will admire the Honda Civic-esque side and rear styling (although that nose treatment is a little heavy-handed).

Holden boss Mark Reuss walked Australia’s automotive media around the Cruze sedan, highlighting “premium” features such as the ultra-clean surfacing, tight shutlines, triple-layered door seals, felt window inserts, extensive use of damping material, fancy engine mounts and single-unit upper body structure and frame.

All add a feeling of substance, refinement or quality that was sadly missing from the horrid old Viva. If you did not know that the Cruze was made in South Korean, we believe you might just assume that this car is from somewhere in Europe or perhaps even Japan.

So far, so good, but the Holden’s interior holds this car’s biggest surprise.

The base Cruze CD tops many flagship small-car cabins with its simply outstanding dash design that is big on symmetry as well as tactility.

The driver is perched nicely before an attractive, multi-adjustable steering wheel, eyeing off classy and clear instruments, while the front passenger is confronted with a quite lovely lower centre console that brings to mind recent Volvo and Honda efforts, while looking as modern as the Ford Fiesta’s excellent fascia.

In fact, we prefer the smart fabric trim inserts on the CD to the rather more predictable leather on the CDX, since it adds an extra dimension of warmth and personality to the Cruze.

Throw in comfortable seats, ample storage facilities, class-leading levels of space for legs and shoulders, and tight, well-built overall interior feel, and you will soon be enamoured at how well presented and appealingly ambient the Holden is.

This is all unexpectedly great stuff for a $20,990 car – and that’s before you tick off all the features not normally associated at this price level, such as six airbags, cruise control (how could a ‘Cruze’ not have this as standard), auto-on headlights, steering-wheel mounted switches, 16-inch steel wheels, and – of course – stability and traction control.

One of the pre-production test vehicles rattled, but the company insisted that this problem has been since rectified. It did bring to mind that Holden might consider offering a five-year warranty from now on …

As it stands then, the Cruze looks fine if a bit derivative outside, and is a knockout blow to most rivals inside.

We drove every one of the four engine and gearbox combinations, and came away more impressed than we thought we would be, although ultimately the Cruze is not a class leading driving experience.

Petrol cars first: The revised 1.8-litre four-cylinder ECOTEC twin-cam 16-valve four-cylinder engine, developing 104kW of power at 6200rpm and 176Nm of torque at 3800rpm, needs revs to move off the line, since it has a fair amount of bulk to move about.

This results in noticeable engine noise intrusion at the higher rev ranges, whether it is with the quite rubbery-feeling five-speed manual or slick six-speed auto.

But drive it around gently as surely most people would and the 1796cc unit is smooth, flexible and has ample power delivery.

As with many models with this engine capacity, driving up hills involves foot-to-the-floor pedal mashing, and the auto gearbox is busy changing down a few gears to get the car moving, but all-in-all the petrol Cruze is sufficiently quiet and refined, and hugely better than the old Viva to drive. But it lacks the sparkle of the better 2.0s offered elsewhere.

The steering is quite direct though, turning into corners cleanly and with high levels of control, while the helm feels firm and stable on the almost exclusively open-road route on which we sampled the Cruze.

Personally, we prefer more weight and feel as you turn the wheel, but the Cruze is still above average in its low price segment for steering/handling finesse and response.

The brakes are well weighted and progressive in their stopping ability, while the ride quality seems AOK – firm but adequately damped, with little noise entering the cabin.

The petrol engine weighs less than the 2.0-litre turbo-diesel driving the front wheels in the $23,990 Cruze CD Diesel, and so feels slightly more agile as a result. Power and torque outputs are 110kW at 4000rpm and 320Nm at 2000rpm respectively.

But both engine variants need a better-quality manual gearshift. An old GM manual trannie bugbear, there is nothing wrong with the actual ratios, but the linkage seems a little loose and stubborn compared to some of the ultra-slick alternatives available elsewhere. Six speeds would also be welcome.

This is a shame, because the Diesel is muscular if a little vociferous, providing a rush of acceleration after a moment’s take-off hesitation. It settles down to be sufficiently quiet and refined from inside the car for most folk to forget that there is a diesel working away ahead of them.

In fact, the Cruze Diesel has the potential to be an almost quasi-sporty contender in the small car range, aided by that sharp steering and good body control, were it not for the ordinary manual gearshift.

Don’t get us wrong: the manual is not a deal breaker, since we can imagine that many rural buyers would put simply leave it in top gear and enjoy the oodles of torque available on request, but the Diesel auto is simply makes for a better engine/gearbox combo.

Thankfully for Holden then, the auto models should account for the lion’s share of Cruze sales. And nobody in this small sedan class offers six forward speeds.

After about 200km of rural and outer-suburban road driving, we hopped out of the various Cruze models feeling confident that Holden has what it takes to make an impact in the value end of the small car segment. We can’t wait to assess it in everyday inner-urban conditions, for sure.

So, as it stands then, for safety, interior space and presentation, features content, diesel availability and ease of driving, the Holden appears to transcend its value pricing, even showing some small cars priced up to $10,000 more how it should be done.

And in the areas where the Cruze seems to not quite lead its class in – driving enjoyment, petrol engine performance and arguably overall design – it is not actually found wanting, unlike the Viva, meaning that the Cruze is, on a whole, a surprisingly complete compact four-door sedan package.

Surprising? Only because after the previous effort, we didn’t expect this Korean sourced but German engineered Holden to be quite so compelling.