Hyundai’s i10 is already a sell-out success, but that hasn’t stopped the company introducing a new engine choice to make the city car even more competitive.

Available from September in the mid and top-of-the-range Comfort and Style models, the new 1.2-litre, four-cylinder ‘Kappa’ petrol unit offers considerable benefits in refinement and performance over the 1.1-litre with no penalty in fuel economy or emissions.

The introduction of the engine will mean all new i10s with manual transmissions will fall into VED band B, with road tax of just £35 a year and considerable tax savings for company car drivers.

The efficiency of the new all-alloy unit means that power output has been improved by 18 percent to 77PS and torque rises from 98Nm to 118Nm – a massive 20 percent increase compared to the 1.1-litre. There is also significantly improved in-gear driving flexibility and more relaxed cruising.

As a result the top speed rises from 94 to 102mph and the benchmark 0-62mph sprint drops by nearly three seconds to 12.8 seconds. Despite this the CO2 emissions and combined fuel consumption are identical to the smaller 1.1-litre engine at 119g/km and 56.5mpg.

At the same time as the new engine, the range-topping Style model also gets leather trim for its steering wheel, gear lever skirt and handbrake to give a more upmarket feel to the interior.

Another benefit is the availability of an Electronic Stability Programme as an option for the first time on the i10. Building on the exceptional four-star NCAP result awarded to the i10 recently, ESP is now available as a low-cost £350 option on all 1.2-litre models. It makes the i10 one of the most affordable ways to buy a car with this proven safety benefit.

Despite all of these improvements, the price of the Style model rises by just £150 compared with the 1.1-litre to £7,995, while the Comfort rises by £200 to £7,545. As with all i10 models, air conditioning and a five-year warranty are standard.

The new engine will also allow production volumes of the i10 to be increased to fulfil the unprecedented global demand. In the UK, more than 2,500 i10s have been delivered to customers - but there are still waiting lists for all models at dealerships. Some dealers have even been advertising i10s at prices above ‘list’ – a situation usually reserved for the latest supercars rather than city cars!

The first of the new 1.2-litre models will be arriving at Hyundai dealerships in September. The new prices are listed below.