Best small cars of 2012

The best small cars should be fun to drive around town and on the open road cheap to buy, economical to run, cheap to insure and you shouldn't have to compromise on comfort . Here's our list of the 10 best small cars on sale today.

Volkswagen Up
The VW Up is our reigning car of the year and it's easy to see why. It's great to drive, spacious to sit in and has a desirable image. Most of the major parts you see and touch are superior to the class norm, so it still feels like an impressively classy product. The VW Up 1.0 75 High Up is the version that you want. It has some nice luxury goodies, and the smooth ride and good refinement make it relaxing to drive.

Skoda Citigo
The Skoda Citigo is virtually identical to the VW Up, so you'll enjoy driving it, and it has a high-quality, attractive interior. It's cracking value for money, too it's a little cheaper than the Volkswagen, too. We'd go for the 1.0 60 Greentech SE model. The Greentech option is exceptionally economical, and it's well built, while mid-range SE trim is well-equipped.

Seat Mii
The third of the Volkswagen Group's city cars, the Seat Mii, is next on our list. It has all the great attributes of the Up and Citigo, however we think the cheaper Skoda Citigo or classier VW Up make more sense. Still, if you go for a Mii, we'd recommend the 1.0 60 Ecomotive. The 59bhp engine is silky smooth and this version is the only Mii that's exempt from road tax.

Seat Mii; the third of the Volkswagen Group's city cars in our top 10

Hyundai i10
The Hyundai i10 is one of the cheapest small cars to buy and run. It's also well equipped and spacious for a city car. The Hyundai i10 1.2 Classic is the model to buy. The engine is clean and frugal, yet still gives decent performance, and it comes with a fair amount of kit.

Fiat 500
You want cute looks and desirability? The Fiat 500 has plenty of both. That desirability means discounts are small, but the Fiat 500 still manages to undercut its rivals. There's no need to look any further down the pricelist than the entry-level car. The 1.2 Pop has enough performance to keep most drivers happy, and being the base trim, purchase prices are reasonable.

Fiat 500; it's cute, desirable, and undercuts many of its rivals

Fiat Panda
The second Fiat on our list is the Panda. It's an endearing and funky-looking small car that won't cost you much to buy and run. It's not quite up to the standard of the Up, but is good value nevertheless. Our pick would be the 1.2 Easy model, which provides adequate performance and decent kit for a reasonable price. Just what a Panda should do.

Toyota Aygo
The last of this trio is the Aygo. Like the others it has a perky engine, cute looks and low running costs. It's solidly built, too, and comes with a Toyota's five-year warranty. The Aygo + is our pick of the range, because it combines excellent value for money with decent equipment levels.

Toyota Aygo; excellent value, with decent levels of equipment

Peugeot 107
The Peugeot 107 heads another trio of identical city cars that make it onto our list. Jointly developed with Toyota and Citroen, the Peugeot 107 is chic and cheap transport around town, but isn't embarrassed elsewhere. Every 107 has the same three-cylinder engine and qualifies for zero-cost road tax. It has decent levels of kit, too, including front foglights and air-conditioning.

Citroen C1
The Citroen C1 is cheap to buy and run, making it an ideal small car for young drivers. It looks pretty smart and has affordable running costs, too. Our pick of the C1 range is the entry-level version the basic VT model might be sparse, but the list price is temptingly low.

Kia Picanto
This is one of the cheapest cars on the market and its interior shames those of more expensive rivals. Most versions are decently equipped and there's a market-leading seven-year warranty. Cheaper versions of the Picanto make the most sense, so the 1.0 1 Air is the model we'd go for. It is exempt from road tax and, as the name suggests, comes with air-conditioning.

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By Iain Reid