New-shape baby Peugeot fares well with improved rear end and small engines. Can it threaten the class leaders?

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Having been on sale for almost a decade and shifting more than 740,000 examples worldwide in the process, Peugeot has seen fit to replace its 107 city car with this - the new 108.

Like its predecessor, the 108 is once again a three-way collaboration between the French car firm, its PSA sibling Citroën and Toyota, with the Citroen C1 and Aygo, respectively.

That the Peugeot rolls a bit matters little, its willingness to slice through curves is enhanced by steering that's accurate and of decently consistent feel

Those first generation cars were the result of the 'B-Zero' project - to develop a small city car that meets the demands of European urbanites, that's fun to drive and affordable to buy.

There are few surprises in store in the new 108 just after you’ve sampled the near-identical second-generation Toyota Aygo and Citroen C1 city cars, which continue to be made in the same factory in the Czech Republic and have been for the past nine years.

Apart from prices, some dealer differences, your own brand prejudices and some nose-tail styling variations, this is the same car we’ve recently tested under two different badges. 

Only details of the deal — perhaps PCP prices or Peugeot’s 'Just Add Fuel' deal make a real difference between this and the rest.

The 108 is now a little more sophisticated, better equipped and about 55kg heavier than the outgoing Peugeot 107However, its drag coefficient falls from 0.34 to an impressive 0.29, and this, along with the availability of stop-start technology and a fuel-saving automated manual gearbox, means CO2 emissions drop to as low as 88g/km.

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All models come in at 99g/km or below to qualify for zero road tax. That includes the new three-cylinder, normally aspirated 1.2-litre Peugeot Puretech engine now offered, in addition to the Toyota 1.0-litre triple carried over from the 107. This same option is also provided for in the Toyota Aygo and Citroen C1 versions.

The 108 itself is little changed dimensionally compared to the 107. At just 3.5 metres long, it’s now 40mm longer, slightly lower and shares an identical width, but its proportioning has changed in that it has less of a cab-forward look, with the result that it has a longer bonnet. Wearing its maker’s rather traditional corporate façade gives the 108 the most conventional face of the Peugeot/Citroën/Toyota trio.

With the Toyota-sourced 1.0-litre three cylinder motor under the hood, the 108 makes a decent little city car. The unit is smooth when spinning, and for a petrol-burner its fuel consumption is very impressive — almost in the diesel class.

The drawback is a lack of mid-range oomph and slow acceleration between 30 and 60mph. There is a remedy — the 20 per cent more powerful Peugeot-sourced 1.2-litre triple.

Its extra capacity gets you 81bhp instead of 67bhp and, more importantly, 86lb ft as opposed to 71lb ft. It appears usefully earlier, too, at 2750rpm rather than a late-in-the-day 4800rpm, the result being a 0-62mph time of 11.0sec rather than 14.3sec.

However, unless you’re especially delicate with both clutch and throttle, urban stop-go progress threatens to be anything but smooth. The culprits are a late-clamping clutch that only fully engages as the pedal nears the top of its travel and an engine mounting system that allows a surprising amount of driveline shunt.

Factor in the triple’s shortage of very low-end torque – you need to feed in more power as the clutch bites if the engine isn’t to falter – and you’ll be reminding yourself of what it was like to be a learner driver. 

This is a flaw that Peugeot and its co-conspirators need to sort now, because it significantly undermines your enjoyment of a car that will se a lot of urban clutch action. It’s all the more a shame when you discover how enjoyable the 108 can be once on the move.

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The 1.2’s extra thrust is evident whenever some mid-range urge is required – often, in other words – and it’s delivered with a smoothly enthusiastic warble that encourages you to make the best of its game B-road manners.

That the Peugeot rolls a bit matters little, its willingness to slice through curves enhanced by steering that’s accurate and of decently consistent feel. On twisting backroads you can soon develop a satisfying rhythm, and all against the backdrop of the triple’s game gurgle.

Its relatively soft suspension allows the Peugeot to ride pretty well, too, although it sometimes gets choppy at speed. Cruising is subdued, the minor controls are easily manipulated and the front seats remain comfortably supportive unless you’re cornering hard. 

The rear seats are a different matter, not because of their cushioning but because there’s so little space ahead of them. Unless you plan to regularly cart kids in the rear, there’s little point in ordering a five-door 108, this car being little more than a 2+2.

It’s a shame the wheelbase wasn’t lengthened for this second-generation edition, especially as the boot is a relatively compact receptacle despite useful enlargement to 196 litres from just 139 litres.

The 1.2-litre motor is only available on the top two trims Peugeot offers, which means you must pay £1250 for the power boost along with some extra equipment. Additional trim over the Access, Active and Allure offered on the 108 is Feline, the appearance of this new range-topping version evidence of Peugeot’s new, upmarket ambitions.

As is the option of a large electric fabric sunroof called Top (a choice oddly not available on the priciest Feline), a selection of optional dashboard finishers for higher-end models and a variety of decal customisation packages.

Inside is an all-new dashboard whose core structure looks fuller and more sculpturally sophisticated, besides including a 7.0in colour touchscreen with all but the base Access trim. Bizarrely, this screen can’t be had with sat-nav – you’re supposed to use Mirrorlink and a smartphone – although the Toyota Aygo offers it.

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There are four trim levels for the hatchback and three for the Top models. The entry-level Access model is only available in three door trim and comes with 14in steel wheels, electric windows, heaight adjustable steeering, remote central locking and an USB port, while upgrading to the Active 108s include 15in steel wheels, air conditioning and a 7.0in touchscreen system complete with DAB radio and Bluetooth.

The Allure trim gets you alloy wheels, a rev counter, heated door mirrors, a reversing camera, and keyless entry and start, but if you upgrade to the GT Line model then you will receive leather seats, sat nav and Peugeot's active safety systems.

The Top models come in Active and Allure trims which are predominantly the same as the hatch models, while the range-topping Roland Garros model get a unique paint job, orange exterior decals, Roland Garros badging, climate control and numerous interior trim parts.

Although the 1.2-litre version of the 108 is decidedly peppier and a less frustrating machine when you’re pressing on, the difficulties of pedalling it smoothly around town do a lot of damage to the pleasure of driving what is otherwise a pleasingly characterful car.

If most of your driving is on back roads and motorways it’s worth the extra. But if your 108 will be town-bound, then the 1.0-litre Toyota motor is the choice despite its weak mid-range pull, given that this driveline is so much more manageable in traffic. It’s a smoother revver, too. Such issues do not plague the 108’s well-rounded Volkswagen Up alternative, incidentally.

On the move the 108 is a much happier car, and a better finished, more convenient, more colourful and more civilised one than its predecessor. If Peugeot can sort the 1.2’s driveline, it will give the VW a harder run.

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