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The premium small car category (starting under $80K) is an interesting one because there are many cars that might not necessarily be cross-shopped, but in one way or another they end up being compared to one another.Our 2026 CarsGuide Car of the Year awards category shortlist saw entrants from Audi, BMW, Cupra, Renault, Smart, Subaru and Volvo. The vehicles range from small petrol hatches all the way to small electric SUVs.Now we’re at the pointy end and it’s time to whittle it down to a winner. First up are the two runners up in alphabetical order, then the category winner.This small SUV from Audi is an oldie but a goodie and that’s how it has ended up as a runner up for CarsGuide’s best small premium car.CarsGuide reviewers love how the Q3, despite its age, still presents well with a stunning exterior design, while the driving experience is elegant, yet fun.“I think it’s such a neatly executed package, it’s hard to pick faults in that car,” said CarsGuide Deputy Editor James Cleary.However there is a new-generation model set to launch locally in early 2026 that could potentially become the new benchmark for the segment.While this French small electric SUV hasn’t stormed up the sales charts like some of its competitors, it’s a dark horse with charming driving dynamics and a stunning interior design.CarsGuide Deputy News Editor Tom White, who had one for a three-month long-term loan early in 2025, noted it’s a car that moves the Renault brand forward in Australia.In fact, he said that everyone who sat in this tester asked if it was a Kia, which he believes is a massive compliment to the Megane E-Tech.The few things holding this car back are the mediocre AC charging rate, plus the Australian-specification car does miss out on things like connected services, which are offered overseas. Thankfully Renault has committed to addressing the latter with an update in 2026.Although it’s been a couple of years now since the current-generation X1 launched in Australia, it still stands out as a segment benchmark, therefore making it a clear choice for CarsGuide’s best premium small car of 2026.“Previously the Q3 was my favourite in that category, I think the X1 does move the game forward,” said CarsGuide Deputy News Editor Tom White.It not only offers class-leading petrol-powered variants, but the availability of electric powertrains in the same body style. All of them have stellar driving dynamics and high-tech interiors.Additionally, besides its compact exterior dimensions, the X1’s clever interior packaging and available storage space makes it almost feel like a mid-sized SUV. You can see why this is now the best-selling BMW in Australia.

On the cusp of five years since the Holden brand disappeared from the Australian new car landscape, a sixth-generation version of what would have been a key part of the Aussie icon’s 2026 line-up has been unveiled in Europe.The Holden Astra, a localised version of its then Opel Astra corporate GM cousin, was in local showrooms when the Lion Brand was finally shuttered in 2021.Now a sleek, all-new Opel Astra has gone on sale in Europe with pure-electric, hybrid and diesel options offered.Designed, developed and built at Opel's headquarters in Rüsselsheim, Germany, the newcomer is available as a five-door hatch and Sports Tourer wagon, claimed to boast upgraded tech, improved comfort and a more distinctive appearance, all with pricing unchanged.Opel said the design of the new car’s nose has been influenced by its Corsa GSE Vision Gran Turismo concept shown at last year’s IAA Mobility show in Munich, as have new 17- and 18-inch alloy rim designs finished in ‘Kontur White’ and ‘Klover Green’.A premium visual touch is an illuminated Opel Blitz (German for lightning) emblem as a centrepiece of the brand’s signature single-module front-end design while ‘Intelli-Lux HD’ headlights are claimed to comprise 50,000 LED elements.Interior highlights include a sweeping media and driver information screen display and ‘Intelli-Seats’ featuring a centre recess to reduce pressure on the tailbone. Powertrain options include the 115kW Astra Electric with a 58kWh battery delivering a claimed range of up to 454km (WLTP) and V2L functionality. A 107kW petrol-electric hybrid variant and a 96kW 1.5-litre diesel are also available. Pricing for the Opel Astra Electric hatch starts at €37,990 (~$63,900) with the hybrid at €32,990 (~$55,500).A shining star for current owner, Stellantis, Opel became profitable soon after its acquisition by the PSA Group (now Stellantis) in 2017, turning around close to two decades of losses under General Motors. Who knows what might have been if the Holden journey had continued?

The MG4 Urban electric hatchback has just been priced in the United Kingdom, offering a new budget option in the EV space. It will start from £23,495 (about $46,000), but it is expected to be significantly cheaper when it comes to Australia, potentially around $30,000.This MG4 Urban differs from the MG4 hatch Australia currently gets, particularly as it is front-wheel drive instead of rear-wheel drive, but is also noticeably bigger.The Urban measures at 4395mm long as opposed to 4287mm with the MG4 hatch.The MG4 Urban will offer MG a more affordable and more direct competitor to other budget EV hatch rivals, lining up with front-wheel alternatives such as the BYD Dolphin and GWM Ora and the coming Geely EX2.With a current starting price of $36,990, before on-road costs, the current MG4 is more expensive than the Dolphin and the Ora, but this FWD Urban could close the gap.The MG4 was the ninth best-selling electric car in Australia in 2025, despite suffering a more than 50 per cent drop in sales year-on-year. We can expect the Urban to come to Aussie shores some time in 2026, but MG Australia did not state an official launch date when contacted for comment. "We do not speculate or comment on future models or product details. We are always evaluating and looking for different powertrain options across our line up - MG Motor Australia will update as models are formally confirmed," an MG Australia spokesperson said. The Urban features a neat interior, including a 15.6-inch central touchscreen and 7.0-inch digital driver display. In the UK, it comes with two single elector motor choices, producing 109kW and 117kW, respectively. It is expected Australia will get a different version of the car, which has a more powerful electric motor, producing 120kW and 250Nm. The UK variants either have a 43kWh battery, offering 323km of WLTP driving range or a 53.9kWh battery, extending the range to 415km.According to MG, the Urban’s battery can charge from 30 to 80 percent in 20 minutes. 

Subaru has hiked the price of its affordable BRZ sports car. The cheapest BRZ now starts from $47,890 (before on-road costs), which is a $3600 jump based on 2025 pricing for the entry manual variant. It is almost $10,000 more than when the second-generation launched in 2022 at $38,990.Manual BRZ's are now the same price as automatic examples, having previously been a $1000 less.This price hike has been reflected across the range.The S variant is now $49,190 up from $45,490, while the tS starts from $52,790 - a $2600 increase.It is now nearly $4000 more than its mechanically identical counterpart, the Toyota GR86.The BRZ still comes in significantly cheaper than a comparative 2.3-litre petrol engine Ford Mustang.The Mustang leads the segment for sales, starting from more than $70,000.Subaru has released a special edition of its BRZ in addition to the announcement of these price hikes.It is called the Kiiro and only 95 units will be offered locally. The car is priced to start from $53,590 (before on-road costs), which is $800 more than the re-priced Coupe tS, which usually sits at the top of the range. This special edition BRZ gets an exclusive yellow paint, in line with the Japanese meaning for the word 'Kiiro', along with 18-inch matte back alloy wheels. There are suede and leather accented seats, with black and yellow elements. Yellow stitching is on the leather steering wheel and gear shift boot.There is an interior 'Kiiro' badge with the limited edition number of the specific car and ‘Kiiro’ badging is also visible in matte black on the rear of the car. It will be available in manual and automatic, keeping in line with the rest of the BRZ range. It will also be powered by the 2.4-litre four-cylinder turbo-petrol engine, producing 174kW and 250Nm found in other BRZ models.The limited edition BRZ tS will hit showrooms later this month. 2026 Subaru BRZ pricing Australia

While utes and family SUVs dominate the top ranks of the sales charts, small, affordable cars remain extremely important to anyone who doesn’t need so much car.That’s why it’s one of the key categories we’re paying attention to in the 2026 CarsGuide Car of the Year (COTY) awards, in this case specifically those models with entry prices below $50,000.Rather than just hatchbacks and small sedans, we’re including small SUVs in the category given the dwindling number of hatches on sale, and consumer tendencies to opt for a small SUV, even as a first car.Based on review data from our team of journalists, our shortlist of 10 finalists below (in alphabetical order) is a broad group with some interesting variety in their offerings.And, as you’ll notice, the cars eligible for the award don’t necessarily have to be new as of this year - they just need to be on-sale as of January 1, 2026, with a variant under the $50K mark.This category's winner and two runners-up will be announced on February 6, 2026. The Hyundai i30 has been a favourite for years, with its current-generation hatch nearing a decade old. From first cars to fleet cars and hire cars and even sports cars, the offering is broad.But there’s a recent development that judges have strongly considered, and that’s the discontinuation of the standard i30 hatchback in Australia. The well-liked but less popular sedan and the spicy N versions in both hatch and sedan have all been enough to secure the i30 a place amongst the finalists, though.We’re fans of the i30 Sedan, formerly the Elantra, for its packaging and its efficiency in its hybrid form, and the N version has been widely regarded as one of the best-value hot hatches in the world. With pricing from $29,250 before on-roads and the hybrid only $4000 more expensive, the i30 Sedan offers up decent value for money. Even the N only just sits over the $50K mark with its $52,000 starting price. Extremely strong points for the judges to consider.Well-loved by the CarsGuide team, the Kia EV3 is as good as we wish the larger and better-selling EV5 was. But Kia’s small electric SUV faces strong competition from cheaper entrants from China that offer strong showroom presence.Starting from $47,600 before on-roads, the EV3’s line-up stretches to a hefty $63,950, but most agree the base model is the smartest buy as well as the nicest to drive. Key points that have drawn judges to the EV3 are its cute (but not tacky) styling, its clever packaging, and the useful but not extravagant features.It’s one of the more expensive competitors in our finalists, and it’s being outsold by rivals quite convincingly, but the CarsGuide COTY doesn’t reward showroom figures. Game on.Like the i30 earlier in this list, the Mazda3 is a veteran of the new small car market, with its current generation having been unveiled in 2018.Once seen as pricey compared to rivals, the Mazda3 is now a rather budget-friendly option as cheaper cars have disappeared over the years - and its sleek styling has held up nicely to boot.Starting from $31,310 before on-roads, the Mazda3 has gradually changed with the times, having been through a couple of tech and line-up changes. The hatch and sedan both offer up a competitive front-row environment and engaging dynamics, and despite its age is still one of the best-selling small cars alongside the i30, both trailing the ever-popular Toyota Corolla.Judges have always noted its small boot and lacklustre rear seat, but the former still beats the Corolla and there aren’t many truly spacious second rows in hatches. Is standing out where it matters enough for the judges?Furthering the mix of old and new in the finalists for the category, the MG S5 EV has found favour with judges for backing up its excellent first impressions.Newcomers in the field of budget small SUVs have tended to disappoint, especially dynamically, but the CarsGuide team was impressed by not only how the MG S5 fares compared to the brand’s earlier efforts, but also how it performs even without comparing it to other MGs.Available from $40,490 drive-away and costing just $47,990 for its top-spec variant, its extremely competitive price and solid list of features bolster an already strong offering.Scoring highly in every category across CarsGuide’s review format, the MG S5 EV shouldn’t be considered an underdog in the COTY fight. Mini, even with its less traditional models, is near-universally loved. So it should be little surprise that one of its new models sits in this list.The Countryman is now available in both petrol and electric, though its starting price is a hefty $49,990 before on-roads for the base Countryman Core. That means it just sneaks into this COTY category, even if getting into its EV version starts from $64,990.Still, Minis are rarely on shopping lists for their value offering, and the Countryman offers impressive tech and features, plus dynamic driving and of course that fun Mini styling.In a category where value and convenience are key, it’ll be a hard sell, but the current Countryman is essentially a BMW for less money, and arguably more interesting. Take that into consideration, and things are looking up.It’s been a big couple of years for the Qashqai, with Nissan’s small SUV scoring a big facelift quite quickly after its current third generation showed up. In early 2026, the Qashqai will go hybrid-only and start from $45,640 before on-roads with its front-wheel-drive-only, 140kW e-Power hybrid the only option. But its petrol offerings fell within the bounds of the COTY judging timeline, and so are also part of the consideration.Attractive styling, smooth power delivery and handling, and a now up-to-date interior with practical features all contribute to a convincing package, but the imminent loss of its petrol-only models will mean the Qashqai is set to become around $10,000 more expensive than before at its base level.Nissan’s extremely competitive ownership offering (the warranty is 10 years and 300,000km if you service with Nissan, five-year/unlimited kilometres otherwise) makes the Qashqai even more tempting. Ticking a lot of boxes there.Stylish, niche, quirky… French. The Peugeot 308 in its current generation leans in hard to all of these things, not least because it’s only available in a single, high-spec hybrid variant for $48,990 before on-roads.It’s gorgeous inside, outside, and to drive, but it’s cursed with limited commercial and perceived value appeal - only 88 were sold in 2025.The 308’s features list is strong enough to rival much more expensive alternatives, and its strongest points in terms of dynamics are most likely to appeal specifically to driving enthusiasts.There’s a lot to like about the Pug 308, it’s just that most people forget it exists. A CarsGuide COTY trophy in the cabinet would surely help with the latter issue…Toyota’s baby icon has gone through some changes lately. In the last few years, we’ve seen it grow up from the simple, affordable ‘first-car’ option it once was to be a simple, much less affordable option. Oh, and now there’s a version of it that’s basically a rally car for the road.A Yaris used to be something you could reasonably buy new as a teenager if you were thrifty, now it’s a $28,990 (before on-roads) option at its entry level thanks to its increased level of safety kit and having gone hybrid-only,Fortunately, it’s still an excellent light car, and even though it’s outsold by all its rivals it still does exactly what a city car should do - getting you around efficiently and with no fuss.In terms of how it snagged a spot in the finals for this category, it helps that the GR Yaris hot hatch is one of the two best drivers’ cars Toyota currently builds.Getting into a German SUV doesn’t have to be an expensive operation, and the $34,990 starting price (before on-roads) for the VW T-Cross is proof. Even the top-spec R-Line comes in at $41,490, and the features list is healthy.To boot, the T-Cross is fun to drive, and judges enjoy its practicality inside, plus the sharp styling outside.While not as efficient as some in its class, nor as cheap to own in terms of servicing, the T-Cross offers a step-up from rivals in the class that are seen as practical budget offerings.Still, its last update was in 2024, so it’ll have some work to do to convince judges it’s still up to date.Alphabetically, and probably in terms of public familiarity, the last to make the shortlist is the Zeekr X, a small electric SUV designed in Sweden but built in China.Cousin to the Volvo EX30 and Smart #1, the Zeekr X has good pedigree and the performance to back it up.Liked by judges for its value, bold style and on-road performance, the Zeekr X is one of the bigger unknown quantities in this COTY category.A recent price cut makes it a $49,900 offering before on-roads, meaning it only just slips into the sub-$50K contest, but with its list of features it should prove a compelling contender. 

We’ve been calling for it and it’s finally here!

MG4 gets significant interior upgrades.

Smart is poised to return to its roots with an ultra-compact city car, according to new spy images.Smart's fifth model since its Mercedes-Benz and Geely re-boot, the #2 has already been teased in Chinese social media as the ForTwo’s successor, but new ‘spy pictures’ shared via the brand’s official channels confirm it will even follow the original Smart car’s aesthetic and proportions.Built on a new platform dubbed ECA (Electric Compact Architecture), and equipped with just two doors, the #2’s design will be be led by the Mercedes-Benz design team. Smart confirmed the car would be built in China and is targeting global export markets.Specifically, the brand teased the #2 at the Munich motor show, with a European release slated for 2027.Due to its ultra-compact dimensions, Chinese media is speculating a battery size of roughly 30kWh, equivalent to other ultra-compact vehicles sold in Australia like the BYD Atto 1 (From $23,990, 30kWh, 220km range) or Hyundai Inster (From $39,000, 42kWh, 327km range).Smart’s reboot looks to continue full steam in Australia, with the brand following up on the #1 crossover and #3 small SUV with the recently-revealed-in-Australia #5 mid-sizer, which is likely to be the first Smart offered in Australia as a plug-in hybrid.It is unclear whether Australia will see the recently-revealed #6 sedan, which looks to be a hybrid-first proposition equipped with a 1.5-litre plug-in hybrid drivetrain.The two-seat #2 which returns the brand to its low-cost and ultra-compact origins may be a perfect fit for markets like China, Japan, Korea and Thailand, but it is unclear whether the brand will take another shot at the poorly-served city car segment in Australia.Generally, cars with ultra-compact dimensions are difficult to comply with Australia’s stringent design laws, and many brands often don’t want to roll the dice with such a car receiving a sub-five-star ANCAP safety rating.However, the segment has again received more interest locally, as brands look to exploit an under-served space that's well suited to electric vehicles. BYD’s Atto 1 recently bucked the trend of associating low safety with ultra-compact vehicles, scoring a maximum five-star ANCAP safety rating.BYD’s affordable offering is yet to put its first runs on the board, but Hyundai’s more expensive Inster has thus far chalked up 426 registrations in Australia. Meanwhile, Smart is not a member of the FCAI and its sales numbers do not appear in the VFACTs industry report.The original Smart ForTwo was sold in Australia between 2004 and 2007 equipped with a 1.0-litre three-cylinder engine. Its line-up expanded over time to include the ForFour hatch and even a roadster model.

This hatch is gone for now, but is it gone for good?

Ford Fiesta could return.