Over the last 15 years or so, the Megane has grown to become one of the most important cars in Europe.

Originally launched in 1995 as simply a hatchback and coupe, it was a replacement for the workaday Renault 19 It has now expanded greatly. In fact, the Megane badge has been attached to six models, everything from mini-people carriers to estates.

The Megane Scenic was Car of the Year in 1997 and Megane II was the first model to win five stars in the Euro NCAP safety system.

Now the new Megane Hatch, tested here, has more success in its sights. It represents the renewal of the entire C-segment line-up. C-segment is the class of car which includes Ford Focus and Vauxhall Astra, and accounts for one-third of all car sales. It is, simply, the biggest and most competitive segment.

The fact that Megane is such a strong contender is testament to Renault’s hard work in this market.

There are two Meganes: Megane Coupe, which is designed to rival the likes of Volkswagen Scirocco, and the Megane Hatch.

Both are designed to offer excellent ride and handling, with a hint of sportiness that you won’t find in its mainstream rivals.

And it’s certainly a good-looking car. It reminds me a little of an Alfa Romeo, especially from the back, which is no bad thing. Renault says it took its cues from ‘Latin’ influences.

It looks good, lean and sporty on the outside, and the interior is, as you might expect from a Renault, very easy to live with. It’s a low-slung car, but that doesn’t make it cramped inside. On the contrary, it feels pretty spacious, except in the back where it can be a little tight.

It is a cost-effective car, cheaper than, say, a Golf and far more interesting to look at and drive than a Focus, thanks in part to a fine range of engines.

Tested here is the 1.9 litre diesel, a product of the Renault-Nissan alliance which is a fine engine. It feels and sounds like a petrol, but has the flexibility and economy that only a diesel can offer.

There are a total of four petrol and three diesel engines available, and some models come with a new automatic clutch system. Called EDC (Efficient Dual Clutch), it is a system which produces better economy and lower emissions than a manual gearbox, yet offers sporty and smooth performance.

All models come with air conditioning and a sophisticated power steering system which offers a fine mixture of ‘feel’ and lightness.

There are also some features which you may expect to find only in more upmarket models, such as dual-zone climate control and automatic headlights and wipers.

It also comes with some neat Renault touches such as keyless entry – simply carry a credit card-style ‘key’ – and a push-button handbrake system. And it is the first car to come with a fully-integrated Tom Tom navigation system; very neat and much better than an add-on system.

If you fancy a little more performance, you can try the GT line-up or the Coupe Cabriolet open-top versions.

Renault Megane Hatch 1.9 diesel Dynamique:- PRICE: £20,240. The test version cost £22,180. The range starts at £15,306.

ENGINE: A 1,870cc, four-cylinder diesel unit generating 130bhp.

PERFORMANCE: Top speed 127mph, 0-60mph in 9.5 seconds.

COSTS: Urban (town) 55.4mpg, extra-urban (country) 64.2mpg, combined 55.4mpg.

INSURANCE: 20E (on the 1 to 50 scale).

WARRANTY: Three years, 60,000 miles.

Steve’s Ratings: Performance: 4/5 Ride/Handling: 4/5 Space/Practicality: 3/5 Equipment: 4/5 Security/Safety: 4/5 OVERALL: 4/5