Small cars don't drive big sales

Kia expects to sell about 300 of its small Picanto hatchbacks a month.

Microcars may be on the nose in Australia, but no one seems to have told the manufacturers about it.

Sales of tiny city cars with modest engine power fell by more than a third last year, but that hasn't stopped the flood of new models.

Following the new Holden Spark and Fiat 500 comes an update for the bestseller in the Mitsubishi Mirage segment.

The Mirage arrives just in time to take on Kia's first entry in the segment, the tiny European-style Picanto due next month.

Mitsubishi's line-up tiddler has a new front grille, redesigned hood and different wheels to match with a cabin that claims better seat materials and black piano accents to elevate the atmosphere.

There are two new exterior colors - wine red and orange - but the biggest changes are in the exterior.

The new electric power steering is said to have improved responsiveness as well as making the Mirage more agile and comfortable on the highway.

Mitsubishi retuned the car's continuously variable transmission for better acceleration in gear and tuned the suspension to reduce body roll in corners, improve ride comfort and reduce road noise.

There are no price cuts, but the brand, which already has a higher-than-usual five-year warranty, has reduced the cost of limited service by $270 over a four-year period.

Automotive brands were excited about the microcar market a couple of years ago, when rising fuel prices and an increased focus on emissions suggested that car buyers would rush to downsize.

It didn't happen because our love for SUVs ended the small car renaissance.

Last year, Volkswagen took the pin off its tiny Up (it only sold 321 cars last year), and the Smart ForTwo was also pulled from the local market.

Last year's only new entrant, the budget Suzuki Celerio, debuted modestly, selling just 1400 cars despite having the lowest price tag for a new car.

Sales of Mirage, the market leader in this segment, fell by 40%.

Despite the doom and gloom, Kia is pushing ahead with plans to launch the Picanto in April.

Kia spokesman Kevin Hepworth told CarsGuide last year that the brand expects to sell about 300 Picantos a month.