Citroen C1/Peugeot 107/Toyota Aygo
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Price: From £6,590
For: Attractive-looking; very compact yet roomy inside; cheap to run.
Against: Narrow boot opening; bouncy ride; higher-spec models are expensive for such a tiny car.
The C1, 107 and Aygo are all built in the same factory, and were developed together from scratch in a joint venture between Peugeot-Citroen and Toyota. These cars are tiny but well-proportioned - adults can sit comfortably in the back seats, and the rear seats fold flat to give a surprisingly large load-space - and cheap to run. There are three- and five-door versions, but the three-door is better-looking and gives excellent access to the rear seats nonetheless.
Best-value engine choice is the 1.0 petrol and although there is also a 1.4 diesel it costs more to buy and you'd have to do a very high annual mileage to recoup the extra expenditure with its fuel savings. And with carbon dioxide emissions of just 109g/km, it fits into Band B for tax (£35 a year) and will be exempt from the London congestion charge as of October 2008.
Toyota is currently offering the cheapest entry-level model, but check out special offers and incentives at each of your local dealers, and look out for limited-edition versions with extra equipment.