And while the 'compact' term is being bandied around, like the Japanese firm's hugely popular Jazz supermini, the HR-V is bigger than it looks.

Boasting a spacious cabin, clever folding rear seats and an easily accessible load bay, it's targeted firmly at families seeking an active yet upmarket lifestyle.

Look hard enough and you can see elements of Honda's existing Civic and CR-V models in the design of this HR-V. This is a good thing, as it promotes a sense of corporate family values and the latest Honda design language is pleasingly bold for a once-conservative company. That said, many Hondas are bought on the strength of reputation, which centres around dependability and reliability. There's certainly more than a sense of those attributes in the HR-V.

Although famous for cars like the NSX supercar and Civic Type-R hot hatch, Honda doesn't forget its bread and butter models when it comes to driver enjoyment. Weighty steering, good ride quality over a variety of road surfaces and a comprehensively adjustable driving position all help to ensure a HR-V driver will be a happy driver.

Key to the car's appeal are its two engines, a familiar 120hp 1.6-litre diesel and new 1.5-litre petrol unit. The former is mated to a slick six-speed manual gearbox, while the latter can also be had with a city-friendly CVT auto transmission.

The diesel turns the HR-V into a great all-rounder, as it's just at home on the highway as it is chugging along in the city. In petrol guise, the car is less appealing in Portugal due to having less power and the price differential between unleaded fuel and diesel here in Portugal, with the entry-level price difference only €3,000 more for the €26,000 diesel.

Honda doesn't 'do' bargain basement, but the HR-V strikes a good balance if you're after a premium ambience for sensible money. Standard kit levels are high, with all bar the base model getting a flash-looking colour touchscreen as part of the infotainment system. Cabin build quality is well above average, while it's hard to put a figure on Honda's long-standing reliability reputation. Modest emissions and fuel consumption performance from both engines should also do wonders for your bank balance.

Iain Dooley