Lexus’s new CT200h will rival the Audi A3 and BMW 1-series in Europe’s lucrative luxury hatchback market when it arrives in UK showrooms early next year, priced from around £21,000. The firm is expecting the car to shift around 30,000 units per year to double Lexus's business in Europe.

The five-door CT200h, unveiled at this week’s Geneva motor show, uses the Toyota Prius’s 1.8-litre petrol-electric hybrid powertrain and CVT gearbox, although the car has been built on an all-new front-drive platform (a first for a European Lexus) to offer a sportier drive than the Prius.

See exclusive Lexus CT200h pics

Lexus hasn’t revealed performance figures for the CT200h, but it is expected to produce considerably more than the 98bhp and 105lb ft in the Prius. As in the Prius, three distinct driving modes are offered (Eco, Normal and Sport) although these have all been retuned in the CT200h to make it a bespoke Lexus car.

In Dynamic mode, the MacPherson strut front and double wishbone rear suspension firm up and steering and throttle responses are sharpened to boost the CT200h’s agility and road holding. The CT200h’s electric motor and nickel hydride battery pack help propel the car up to 1.24 miles on electric power alone, helping the CT200h reach its target of offering class-leading CO2 emissions of less than 99g/km.

The CT200h is 4320mm long, 1765mm and 1430mm high, meaning it is longer, wider and taller than the A3 and 1-series. Its 2600mm wheelbase is only eclipsed by the 1-series’ 2660mm and its 345-litre boot is bettered only by the A3’s 350-litre capacity.

Styling has been scaled back from the more radical looks of the LF-Ch concept from last year’s Frankfurt show, mirroring that of larger Lexus models. Most of the CT200’s sales are likely to come from those seeking a hybrid powertrain in a premium hatchback, something none of Lexus’s rivals currently offer. It will remain as a hybrid-only model, too.

Although not confirmed, a small SUV and three-door CT200h are set to be spun off this platform.

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