But price is the nicest cut.

Honda has returned fire in the medium segment with its new Honda Accord Euro, dropping the entry price by $1000 and adding extra features. The company says it is mainly down to the changed exchange rate between a strong Australian dollar and the lacklustre Japanese yen, but some cynics might also suggest the rise and rise of Mazda also had something to do with it.

Honda says in addition to the price cut, the features lists have grown to include between $2000-$3500 in added value. The new Accord Euro is lower, wider and longer than its predecessor — which helped reinvigorate the medium segment when it was introduced in 2003.

While a wagon and a diesel are both still under consideration, Honda director Lindsay Smalley says the Accord Euro sedan had done much for the brand in Australia.

“With 45,000 sales in Australia since its launch five years ago, the first-generation Euro has been one of our most successful models ever.”

The Accord Euro sits on a new platform and has grown 35mm in wheelbase to 2705mm, contributing to an increase in overall length of 65mm to 4740mm. The car's overall height has dropped by 5mm to 1440mm but more noticeable in the cabin is the extra width, up 80mm to 1840mm, with a 1580mm front and rear track up from the previous model's 1515mm.

Standard fare on the new $32,990 Euro base-model includes dual-zone climate control with rear vents, stability control, reach'n'rake leather-wrapped steering wheel with audio and cruise controls, 17-inch alloy wheels with a full-size spare, alarm, trip computer and a 6CD-stacker 10-speaker sound system.

The Luxury model is priced from $39,990 and adds a sunroof, leather trim, heated front power-adjustable seats, carbon-fibre trim, 18-inch alloys with a temporary spare, auto-dimming mirror, rain-sensing wipers, HID headlights, parking radar.

The range-topper Luxury Navi is priced from $42,990 and gets satellite navigation and a reversing camera; the five-speed automatic is available across the range for an extra $2000.

The safety list includes active head restraints, dual front, front side and full-length curtain airbags, ABS brakes and stability control standard range-wide.

The engine size remains at 2.4 litres but the power has been increased to 148kW (up 8kw) and peak torque is 234Nm (up from 223Nm) for the six-speed manual, while $2000 five-speed automatic model has to make to do with 230Nm. Claimed fuel use from the new Euro has improved slightly, now 8.9 litres per 100km for both transmissions, down from 9.1 and 9.4 for the previous automatic.

Among the new car's highlights is the Motion Adaptive electric power steering system, which works with the car's stability control system to encourage the driver's steering inputs to assist the stability control system.

Some of the cars on the launch experienced a grabbing feeling within the steering, which could have been the stability control teaming up with the power steering in the wet conditions.

What is obvious during the first drive is that the new and slightly heavier Accord Euro has retained its excellent balance and grip as well as a reasonably compliant and quiet ride.

The wet, hilly roads used by the company to show off its latest medium-segment contender failed to seriously unsettle the Honda sedan. The nose points easily, the body roll is well-contained ... and the entertaining nature of the whole package has been maintained.

The first model sampled was the range-topping Luxury Navi, with the optional paddle-shift equipped five-speed automatic.

The gearbox itself is a decent unit but suffers for the engine's peaky torque curve on hills driving, meaning that Sport mode is a must.

The satnav screen has been given a better cowling than the Honda Legend's glare-affected screen, but the centre-stack is overcrowded with buttons and can be difficult to negotiate.

But jump into a manual Euro and the drive experience is far more cohesive. The slick six-speeder is a delight and the engine's rev-hungry attitude demands plenty of gear changes.

Honda has maintained its place at the pointy end of the medium-segment field and has guaranteed a good choice of strong medium-sized product for the market.

Snapshot

Honda Accord Euro

Price: from $32,990

Engine: 2.4L/4-cylinder 148kW/234Nm (auto 230Nm)

Transmission: 6-speed manual or 5-speed automatic

Economy: 8.9L/100km

Rivals

Mazda6: from $29,740

Subaru Liberty: from $32,490

Volkswagen Jetta: from $32,990

Ford Mondeo: from $29,990 It's Euro evolution: new Honda Accord Euro first drive

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