FOUR years after it first appeared in Europe, the second-generation Fabia from Czech brand Skoda has launched in Australia, armed with an array of standard features and a highly competitive price aimed right at the heart of the bustling light car segment.

Limited initially to just two models – the $18,990 77TSI and sportier $21,990 Monte Carlo edition – the base model Fabia undercuts the Volkswagen Polo with which it shares many components by $860 and shares its price with the mid-range Ford Fiesta LX and Suzuki Swift GLX.

The ambitious company, which pitches itself as the entry-level brand within the colossal Volkswagen empire, has big plans for its littlest model in Australia.

Head of Skoda Australia Matthew Wiesner hopes the Fabia will appeal to a different demographic than its current line-up, comprised of various Octavia and Superb models.

“We’ve got a fairly heavily skewed, male 40+ year old market that buy Octavia and Superb, generally speaking," he said.

“So we now start talking to a much younger market and we start talking to hopefully more female buyers and do all the things that every mature brand must do.”

On paper at least, the company’s smallest model stacks up well when compared to some of its other closest rivals – including the Mazda2, Fiesta, Toyota Yaris, Swift and Hyundai i20.

A substantial facelift for the 2010 model year in Europe brought with it the addition of the spunky 77TSI engine that can also be found in various VW Polo and Golf models, and it is this engine which powers the local line-up.

At 77kW, the power output of the diminutive 1.2-litre turbo four-cylinder puts the little Skoda at the pointy end of the field, while peak torque of 175Nm (achieved between 1500 and 4100rpm) is substantially higher than all comers bar the Polo, which it equals.

This is the sole powerplant option currently available in the Australian line-up, and is matched exclusively to a five-speed manual transmission.

A seven-speed DSG semi-automatic version will join the range in the first quarter of next year, alongside the more spacious wagon and crackling RS 132 hot-hatch, which shares much of its lineage with the Polo GTI.

Claimed fuel consumption of 5.5 litres per 100km is also enough to eclipse all bar the Swift – which it equals – and its 315 litres of boot space make it as commodious as many members of the bigger small-car segment.

The car’s 45-litre fuel tank means it has – on paper at least – a combined-cycle driving range of 800km.

The gutsy little engine can haul the 1120kg Fabia to 100km/h in a claimed 10.1 seconds, while CO2 emissions are a low 128 grams per kilometre.

Standard equipment on the base model 77TSI includes 15-inch steel wheels, an eight-speaker MP3 compatible sound system with auxiliary input, tinted windows, air-conditioning, a leather steering wheel with audio and phone controls, Bluetooth connectivity, cruise control with trip computer, front foglights, height- and reach-adjustable steering wheel, movable centre front arm rest and heated door mirrors.

Typically of the Volkswagen group there is also a fair choice of optional accoutrements, including 15-inch alloy wheels, rear parking sensors, an audio USB cable, electric sunroof and climate-control air-conditioning.

Meanwhile, the Monte Carlo gets standard 16-inch black alloy wheels and alloy sports pedals, privacy glass, menacing black exterior highlights on the roof, wheel-arches, grille and foglight surrounds, sports seats with bigger bolsters and a sportier steering wheel (which unfortunately loses the audio and phone controls of the 77TSI).

Skoda Australia believes the Monte Carlo will initially outsell the 77TSI, accounting for around 60 per cent of total sales. This ratio will change when the range expands next year.

Standard safety equipment across the range includes six airbags, stability control, ABS brakes with brake assist. The Fabia achieved a four-star Euro NCAP safety rating when it was tested back in 2007.

Skoda typically attempts to differentiate itself big brother Volkswagen stylistically, and the boxy Fabia is no exception.

Unlike the comparatively demure Polo – and befitting of a car in this segment – the entry-level 77TSI is available in a list of paint colours as long as a tall man’s arm, including the lairy Rallye green and Sprint yellow.

Four of these hues are also non-metallic/pearl effect, giving plenty of options for those not willing to fork out an extra $490 for sparkly paint. A contrasting white or silver roof finish is also available with most colours as a $390 option.

The Monte Carlo, meanwhile, comes with seven colour choices, while the sports seats can also be had with bright red trim inserts to match the red stitching on the sportier three-spoke steering wheel.

The front wheels of the Fabia use a MacPherson strut suspension system, while steering is controlled via direct rack-and-pinion with electro mechanical power assistance that keeps the turning circle to a city-friendly 10.0 metres.

The rear wheels use a torsion-bar stabiliser set-up, and there are disc brakes both front and rear. Frontal anti-vibration mounts keep noise and vibration down to a respectably low level.