MITSUBISHI Australia has ushered in a model year 2006 upgrade for its small Lancer sedan and wagon range, headlined by a cleaner and significantly more powerful MIVEC engine.

On sale from mid-September, the MY2006 Lancer range has also been streamlined and re-equipped to make it more attractive to fleet customers.

Biggest news is the addition of the same 4G65 2.4-litre MIVEC variable valve timing-equipped four-cylinder engine that debuted here in the Grandis people-mover last May, and which has powered Mitsubishi's Outlander compact SUV since late 2004.

Offering 115kW at 5750rpm and 220Nm of torque from 3500rpm, the new engine is 25 per cent more powerful and delivers 27 per cent more torque than the 2.0-litre Lancer engine it will replace.

That makes the MY2006 Lancer the most powerful small sedan available - lineball with the Mazda3 SP23 sedan/hatch and down only on Toyota's Corolla Sportivo hatch, which are both priced around $30,000.

Apart from its larger capacity and the benefits of MIVEC inlet valve timing, the new engine includes a larger bore, shorter block, new pistons and rings, a new crankshaft and new balance shaft.

The new 2.4 MIVEC range opens at $20,990 for the Lancer ES manual sedan - just $1000 more than the current ES 2.0-litre sedan, which will continue on sale at its $19,990 price point.

Mitsubishi Australia will take delivery of extra numbers of 2.0 ES Lancers until the end of 2005, after which its 92kW/173Nm engine will cease to meet Australia's stricter Euro3 emissions standards.

Lancer's new MIVEC engine therefore remains optional in the entry-level ES variant and standard on luxury-spec LS and sports-spec VR-X variants. Lancer's former Exceed flagship has been discontinued.

MY2006 Lancer wagon pricing opens at $23,490 for the ES 2.4 manual, while sedan-only LS pricing starts at $24,490 and the opening VR-X sticker price is $28,990. The VR-X wagon is priced from $31,490, with all 2.4 Lancer autos attracting a $2500 premium.

For MY2006, the entry-level ES 2.0 sedan adds a chrome-rimmed grille, monotone black interior trim, cruise control (not previously available) and a driver's vanity mirror as standard.

Apart from its more powerful new MIVEC engine, for the extra $1000 over its 2.0 ES sibling, the base 2.4 Lancer gains larger 276mm ventilated front brake discs, 262mm solid rear brake discs (instead of rear drums), ABS brakes with electronic brake-force distribution, 15-inch steel wheels with wheel covers (instead of 14s), four power windows (instead of two), white-faced instruments, a Sports Mode manual-shift function for four-speed auto versions (both previously reserved for VR-X) and revised bumpers.

On top of the extra ES kit, the MY2006 mid-range LS gains 15-inch alloy wheels, climate control with pollen filter, a six-stack/six-speaker in-dash AM/FM/CD player from Verada, a leather-wrapped steering wheel, gearshifter and handbrake grip, cloth centre console lid, black woodprint binnacle surround and a titanium-look centre console panel.

Sports VR-X variants, meantime, add to this an Evo-inspired mesh grille with floating triple-diamond logo, new sports front seats, aluminium sports pedal plates, silver mesh binnacle surround and a 60/40-split folding rear seat.

Two new colours have been added to the MY2006 Lancer range, with solid red and grey mica joining the existing colour palette.

Mitsubishi says the ES 2.4 sedan represents $2000 in added value over the ES 2.0 for an extra $1000, while the LS is priced $700 higher than before but adds $3500 in value.

In terms of rivals, Mitsubishi says ES 2.4 sedan is $1200 more expensive than the least expensive version of Toyota's segment-leading Corolla, which lacks the base 2.4 Lancer's ABS, cruise control, power windows and passenger airbag, and offers a less-powerful 1.8-litre engine.

Similarly, Mitsubishi claims the ES 2.4 sedan is better equipped and more powerful than all its small sedan rivals, including the identically priced Ford Focus CL, which lacks ABS/EBD, cruise control, power (rear) windows and mirrors and the 2.4 Lancer's performance.

In fact, with 28 per cent more power than Nissan's 1.8 Pulsar, 25 per cent more power than Holden's 1.8 Astra Classic sedan, 15 per cent more power than Corolla 1.8 sedan and 11 per cent more power than the 2.0 Mazda3, it's matched only by the circa-$30,000 Mazda3 SP23 and bettered only by the 141kW Corolla Sportivo hatch for power output.

Mitsubishi says its five/10-year warranty, Lancer's reputation for reliability, its lower 9.4L/100km fuel consumption and the fact the new 2.4 Lancer is down just 2kW on the 2.4-litre engine that powers the 140kg-heavier and $5500 more expensive Camry - 50 per cent of which are sold to fleets - make the revised Lancer more attractive than ever fleet customers.

Mitsubishi admits that in the absence of a hatch lancer will continue to compete in 50 per cent of the small car segment, but hopes to increase sales by an average of 200 per month to around 1200 per month, with ES expected to attract half of those sales.

Lancer wagon is forecast to find 200 new homes per month.