If you could peek inside the DNA of the Italian population there would be, I suspect, running through the middle like a stick of Margate rock, the word chic. It’s no surprise, nor coincidence I imagine, that some of the most beautiful and exotic cars have emerged from the design studios of Bertone, Pininfarina and Zagato.

The Fiat Panda joined this exclusive company in 1980, designed by Giorgetta Giugaro. It might not have had the visual appeal of a Ferrari, but its unremarkable exterior hid a number of innovative ideas designed to make owning the small hatch as easy as possible: The rear seat could be folded flat to create a bed, much of the interior trim and seat covers could be removed for cleaning and all the glass panels were flat, making them cheap to produce and easy to replace. This, then, was a car for the masses.

The current, and third generation, while technologically and visually a world away from its namesake, shares the same ambitions.

The high-sided mini-MPV looks set the Panda apart from its more traditionally-styled rivals. You could argue that it’s a bit of a risky strategy but millions of people have dared to be different so it’s clear that Fiat is reaping the rewards of their decision to plough their own furrow.

The tall sides and the short overhangs give the Panda a cute, endearing look, creating a car that oozes personality. The overall shape has been softened with a more rounded look than the previous model which, apart from adding to its ‘friendly’ appeal, also makes the current model one of most aerodynamically efficient cars in its class.

Despite being barely more than three-and-a-half-metres long, it is possible to squeeze five adults into the Panda though, despite what the official blurb might say, it might be a some way short of comfortable and just the wrong side of cosy. Limit the numbers to four, however, and there shouldn’t be too many complaints from those in the rear, particularly when it comes to headroom.

Fiat have worked hard, and succeeded, to give the two-tone dashboard a real style makeover. The controls are beautifully simple to operate and all the buttons are square with rounded-off corners, echoing the lines of the more curvaceous exterior. The instruments are clear and bright too.

Practicality also figures highly with, wait for it, 14 storage compartments. The boot is a very reasonable 225 litres but, and here’s another clever little trick, sliding rear seats are available as an option which, when in their foremost position, can liberate another 35 litres of luggage space. The vertical rear door means that all that space is easy to use, as well.

A special mention should go out to the audio unit because, as uncool as it might look for a respectable gent of my age, I like to play my music loud(ish) and, as it turns out, the speakers proved more than capable of coping. In fact, I thought the tone and clarity was excellent. There’s also speech recognition over Bluetooth powered by Microsoft which, again, I found to be superb. It was able to read out incoming texts and recognised my dictated replies with credible accuracy.

There are three engines available – 1.3-litre 75bhp diesel, an 85bhp TwinAir and, the one that was under the bonnet of my Panda Lounge loan car, the 1.2-litre 69bhp FIRE – all of which have their own unique character. In a car that develops ‘just’ 69bhp getting to 60mph becomes more a matter of if, rather than when (although it’s only fair that this particular Panda can hit 100mph – eventually). This is a car built for the city where what matters is what I like to call ‘nippiness’ and, on that score, the Panda hits the mark.

That’s not to say that it’s not a capable motorway cruiser, the engine fades away to a distant hum and the wind and road noise is well-suppressed for a small car. The front seats could do with more lateral support – you can find yourself sliding around a bit on twisty roads, particularly as there’s a fair amount of body roll – but they’re comfortable enough for long straight highways.

My left leg proved to be a bit of an issue while behind the wheel. Namely, what to do with it. There's very little space next to the clutch pedal for a size 10 so I was forced to drive with my left leg bent which, over longer distances, was a tad uncomfortable.

The suspension is supple, soaking up bumps with surprising ease, but it’s not difficult to invoke a little understeer, especially when the road is a touch slick. Fortunately you get plenty of warning so it’s easily corrected. It all adds up to a rather entertaining ride, if you’re so inclined. Who said you need to go fast to have fun.

And to make life easier in towns and cities the ‘City’ button on the dashboard increases assistance to the power steering, making it lighter and easier to manoeuvre into, and out of, any tight spots you might find yourself in.

The new Panda is a totally different beast to the original. Buyers’ expect a lot more from their cars these days and, consequently, they have to be a lot more adaptable. Fortunately, when it comes to small cars, Fiat know what they’re doing and the new Panda is testament to their know-how. The MPV looks might dissuade some people from taking the plunge but they’d be missing out on a car that handles well, is spacious and has a strong choice of engines. What's not to like?

Fiat Panda 1.2 Lounge

PRICE: From £9,890

ENGINE: 1.2-litre 8v

TRANSMISSION: 5-speed manual

POWER: 69bhp

ACCELERATION (0-62mph): 14.2sec

MAXIMUM SPEED: 102mph

URBAN: 42.2mpg

EXTRA URBAN: 65.7mpg

COMBINED: 54.3mpg

EMISSIONS (CO2): 120g/km

For more information about Fiat cars click here.