We like
Value equation, lower 1.6 entry price, improved styling, new high-tech options, 1.8 TSI's seven-speed DSG, 2.0 TDI economy

Room for improvement
Brand value, unknown resale value, 1.6's midrange response, 1.6 refinement, 2.0 TDI price premium

OBVIOUSLY a lot is riding on the facelifted Octavia for Volkswagen Group Australia, which could not have re launched the fledgling Skoda brand at a worse time as Australian cars sales last year declined from record levels in 2007 and continue their downward spiral in 2009.

Skoda does not hide the fact it is disappointed to have found little more than 800 customers in its first full year of sales in 2008, but rightly points out that no new automotive brand – not least one as off-beat as Skoda – can be successfully established in 18 months.

With little else to crow about, Skoda says its brand awareness has increased from 30 per cent to almost 60 per cent in that time, in a trend that should continue as the Czech maker’s local retail network expands by 50 per cent this year – from 21 to about 30 dealers.

It also points out that new models like the Superb flagship in June and the potentially volume-selling Yeti compact SUV early next year, when Europe’s in-demand Fabia could also arrive, can only help to put Skoda more firmly on the shopping lists of Aussie car buyers.

But, plainly, if Skoda is to survive in Australia it needs the facelifted version of its volume-selling Octavia mid-sizer to succeed.

After our first drive of the simplified, new-look range last week, however, it’s clear the Octavia’s local custodians have given the Golf V-based model its best chance ever of succeeding.

Directly addressing one of the subjective complaints that have long been levelled at the Volkswagen brand’s models, an all-new nose and RS-style rear bumper and tail-light treatment have given the Octavia an unequivocally more upmarket look.

In fact, it’s amazing just how much difference a set of (dare we call them Holden Epica-style?) headlights, a front bumper, new grille and colour-coded rub-strips make. We’d even venture to say the pre-facelifted MkIII Octavia, launched in Europe in 2004, looks more like its circa-1996 Octavia MkII predecessor (the first to be produced under VW ownership) than its revised 2009 successor.

As well as appealing to a wider audience than the “early-adopters not afraid to spend $35,000” on a little known brand with Eastern European styling, the new entry-level version of Skoda’s facelifted Octavia should also attract a new band of customers in the market for top-end small cars or the least expensive Japanese mid-sizers.

Priced from under $27,000, the new base Octavia 1.6 may not match the performance offered by either group of direct price rivals, but it certainly improves on the value equation for which Skoda is famous in Europe.

To be fair, the superseded Golf’s two-valve 1.6-litre four isn’t as pedestrian as we expected, offering a decent amount of off-idle torque to make round-town stop-start manoeuvres a doddle, even it isn’t the smoothest or most refined VW engine around.

And what it lacks in midrange punch it makes up for with an effective top-end power delivery that, although it comes with a coarseness that’s out of kilter with the rest of the serene Octavia package, doesn’t disgrace the cheapest Octavia during open-road overtaking efforts.

The 1.6 features a respectably high level of safety and convenience equipment, but doesn’t come with the six-speed manual shifter of its turbocharged siblings or many of its mid-size (or even small) rivals. That said, its five-speeder isn’t a chore to use either and the optional six-speed auto is certainly a match for any self-shifting competitor.

The 1.8 TSI turbo-petrol is perhaps the pick of the Octavia bunch, even if it is thirstier than both the 1.6 petrol and 2.0 TDI, because it mates silky-smooth acceleration right across the rev range with VW's equally creamy cutting-edge seven-speed double-clutch auto.

That’s one ratio more than the DSG auto found in the 2.0 TDI, which is nevertheless the most frugal of the three engines while still producing more torque than both petrol engines. But 2.0 TDI buyers will pay $2500 extra for the privilege - before diesel fuel and servicing costs are taken into account.

Optioned with a paddle shifter-equipped three-spoke sports steering wheel (just $190), both DSG autos offer one of the best twin-clutch shifting experiences this side of a BMW M3 or Porsche 911.

Priced neatly between the Subaru Liberty 2.5 auto and Mazda6 Classic 2.5 auto, the Octavia 1.8 TSI DSG offers less outright performance but more engine flexibility, while being more than two-tenths quicker to 100km/h and returning fuel consumption that’s around 2L/100km better.

Similarly, the diesel Octavia undercuts the price of both Ford’s Mondeo TDCi and Peugeot’s (smaller) 208 2.0 HDi, while bettering and matching them on power and torque respectively, and outpacing them both for acceleration and fuel economy. Indeed, one must look to Holden’s Epica or Hyundai’s Sonata for a better-value mid-sized diesel.

The rest of the familiar Octavia package is all Volkswagen class, which continues to translate to a super-quiet cabin, top-notch interior design and build quality, a satisfying combination of plush ride and tidy dynamics that err towards safe front-drive understeer, plus a level of chassis integrity that stamps it firmly as a premium European product.

To the fundamental Golf formula the latest Octavia adds no more rear legroom but class-leading boot (or hatch) space, a number of the latest high-tech Volkswagen options, the highly exclusive Skoda nameplate and, now, a starting price that emphasises the Czech mid-sizer’s value statement even better than ever.

And that's a proposition Australia's automotive landscape would be all the more mediocre without.