KIA is on a roll in a big way, and for proof, look no further than the smallest car in its range.

The Picanto is a fresh and funky sub-B city car designed and engineered co-jointly in Korea and Germany, for global key-demographic consumption. That’s a very dry way of saying that its job is to lure young people to the fold and keep them there. So its importance cannot be understated.

That Kia includes Australia in its grand plan for world domination ought to be applauded, because most other car companies don’t even bother selling their tough-to-market littlies here, and that’s a short-sighted shame.

Diminutive on the outside but roomy enough inside for four burly blokes to fit comfortably, the latest, larger Picanto does not feel like a sardine can inside. Indeed, with excellent all-round vision and a commanding driving position, it’s only when you exit from the five-door hatch that you realise just how stubby it is. Perfect for urban living.

Furthermore, for a sub-$15K opener, the S (there’s only one variant on offer for now in five-speed manual or four-speed auto guises) doesn’t seem like a price leader for bargain-hunting types. Hard shiny plastics might abound, but they’re clearly well made and squeak-free. The plastic wheel is nice to behold.

The dials for both the instruments and climate unit are a masterpiece of clarity. There’s storage galore. And that loftily-perched touchscreen is right on the money.

Better still, the latest Picanto gains features that had us scratching our heads as to how Kia can do it for the money. Like cruise control with speed limiter. Apple CarPlay/Android Auto. Auto headlights. And that all-important reversing camera. That’s on top of the stuff the first version impressed us with, like rear sensors and four-wheel disc brakes (still a rarity in the class above!). The only thing missing is AEB availability, but then nothing else at this level has it either. And it’s coming, apparently.

Now to paraphrase Shania Twain, all that wouldn’t impress us much if the Picanto’s seats were rubbish (quite the opposite), the ambience was horrid (it’s not) or refinement was on the nose (the Kia is better than plenty of cars we can think of costing thrice as much). And the now-larger boot is practical enough to have potential buyers of superminis in the next size bracket up think twice.

The carry over 1.2-litre four-pot atmo Kappa engine is a gem. Perky, eager through the gears, and keen to rev up to its 6000rpm limit, it doesn’t drive, feel or sound undernourished around the rural Queensland roads where the littlest Kia was launched. Yes, at 110km/h the tacho is sitting at a high-ish 3000rpm in the four-speed auto, but the general ambience is one of civility.

Of course, we prefer the light and easy five-speed manual, which allows the keen driver to really cane the Picanto like it’s been stolen.

But the auto – even with just four forward ratios – is infinitely preferable to the droney one-dimensional joylessness that the Continuously Variable Transmissions (CVT) offered in rivals like the very grown-up Holden Spark and under-baked Mitsubishi Mirage.

You can slot that lever down into first, second or third, and manually hold on to each gear, making the most of the limited performance on offer. Or keep it in Drive and enjoy the fast, lag-free shifts that only a good torque-converter auto can deliver.

Critics who pan the Picanto’s transmission clearly haven’t explored that ageing gearbox’s potential.

And then there’s the steering, which is well weighted and eager to tip into a corner fast, for fun and involving handling the chassis just grips gamely when thrown into a corner despite cheapo tyres, and the brakes do their thing with confidence and control. We’re not talking hot-hatch fun, of course, but the point is, if you’re willing, the Kia is capable. And ready.

That the ride is firm but never choppy or loud further increases our respect for the series.

So, on first acquaintance, the third-gen Picanto is seriously good, and not just for the low price, high specification, or best-practice warranty. It is genuinely fun to punt around, well put together, pleasant to sit inside, and easy to enjoy.

So it should be too, for something that’s been designed to take on the best from Europe such as the still-brilliant Volkswagen Up.

Panning anything about it – like perhaps the shiny plastics or plastic wheel – would just seem churlish to us.

We’re glad Kia in Australia has persisted with the Picanto. It deserves to succeed.