Attempt to make a splash in the family hatch market without a high-tech diesel engine in the armoury and it's likely you'll barely leave a ripple. Hence the importance of the Mazda3 1.6-litre diesel model we're looking at here. As with the petrol variants, this car offers a useful combination of quality, style and realistic pricing. All of which should, in theory at least, enable Mazda to make the establishment feel distinctly uncomfortable.

The Hiroshima-based maker calls this 1.6-litre diesel engine the MZ-CD (Mazda common-rail turbo diesel) and it's an all-aluminium 16-valve powerplant good for a respectable 107bhp. Its 240Nm of torque is delivered at a lowly 1,750rpm which means that you get superior pulling power at barely more than tickover. Available in five door hatch and four door saloon form, the engine will accelerate the Mazda3 through 60mph in 11.3 seconds and on to a top speed of 115mph. If you want to go faster, there's a 2.0-litre version of the MZR-CD unit, but you'll need to front up a £1,000 premium for it.

In the 1.6-litre diesel, a combined fuel economy figure of 58.9mpg will be enough for most and the carbon dioxide emissions figure of just 128g/km looks very good. Buyers who plump for this model will get a turbo diesel engine that Mazda claim virtually matches the 1.6-litre petrol unit in terms of refinement. Unfortunately this is a greater indictment of the petrol engine's noise levels than any great pat on the back for the diesel powerplant. Nevertheless, the diesel is no noisier than some of the best in class, due in no small part to a rigid but lightweight aluminium engine block and a vibration reducing dual mass flywheel. An exhaust gas recirculation system contributes to the car's low CO2 emissions.

Prices start at £12,905 for the base five-door model, with the TS model retailing at £14,805 in five-door hatch form and the TS2 (also offered as a saloon) some £900 more. The pricing is key because Mazda need to shift large volumes of this very significant car.

Although the changes to the latest version are difficult to spot, they're extremely extensive. The exterior benefits from tiny changes to the front grille, lights, alloy wheels and colour palette while the cabin gets more equipment, a higher quality feel for the instrument panel, revised trim materials and the option of a keyless go entry system.

"A turbo diesel engine that Mazda claim virtually matches the 1.6-litre petrol unit in terms of refinement"

Much of the development budget has been spent on targeting the three issues identified by existing Mazda3 customers as requiring attention, namely refinement at speed, fuel economy and luggage capacity. The refined aero package has helped to reduce fuel economy by up to 6 per cent, a revised boot on the saloon model has eased access to the luggage bay but these are small improvements. The area where Mazda can really award themselves a gold star is refinement at cruising speed. Although a 1.4 decibel reduction in cabin noise may sound like pretty small beer, the scientifically-minded amongst you will know that 3 decibels represents a doubling of noise, so this model really is way quieter than its predecessor.

There's additional soundproofing in the roof and under the bonnet, the car's generator has been replaced by a quieter unit, the tyres have been redesigned to run in a more hushed manner and the wheel rims have been revised to reduce noisy harmonics. The suspension has been modified to make it stiffer and allow the shocks absorbers and dampers to keep the tyres better planted on the tarmac. The geometry has been altered to reduce understeer during fast cornering and the Mazda3 does at last feel closer to the Ford Focus, a car which shares many of its underpinnings.

The shape gets the thumbs up right from the outset. Mazda's designers are currently in a bit of a purple patch and it's been a while since we've seen a clumsy shape emerge from the company's design studios. Think of it as a longer and sleeker looking Audi A3 silhouette and you're not too far off the mark. The chunky C-pillar is probably the most distinctive styling signature and the complexity of the design suggests it would have been very easy to get wrong, but the little Mazda pulls it off nicely. The saloon model features a swoopy coupe-like roofline that avoids the frumpy look of many small notchbacks.

The interior is very similar to the Mazda6 insofar as it offers a resolutely modern design with decent levels of equipment coupled with materials quality that's rather variable. Although the fabrics and leather trimming of the test car were beyond reproach, some of the dash plastics felt a little lightweight. The steering wheel and overlapping aluminium-rimmed dials look very sporting and there are some nicely detailed metallic touches dotted about the cabin. The minor controls on the centre console are all very easy to get to grips with and upspec models feature an LCD screen that rises out of the dash top to house functions such as satellite navigation.

Interior accommodation is middle ranking, Mazda perhaps deciding that if customers in this price range really want to maximise the sheer amount of cubic inches available in the cabin, they'll likely opt for a mini-MPV. The Mazda3 isn't huge in the back and the small rear doors don't open particularly wide. Headroom is very good, despite the swoopy styling. The front pair of passengers should have no difficulty getting comfortable although one drawback of the thick rear pillars is somewhat limited rear three-quarter visibility when reversing or doing a 'lifesaver' check when switching lane.

Although the chassis may well be sharpened up in future sportier versions, the Mazda3 doesn't feel on home turf if hurled through a series of corners with extreme prejudice. The controls feel well weighted but keen drivers will yearn for a little more feedback and response. That can probably be engineered in with beefed up springs, lower profile tyres and industrial-strength anti-roll bars but for the time being, the Mazda3 should be applauded for bringing big car ride quality into a manageable sized package. Equipment levels are, as you would expect from Mazda, generous and aggressive pricing is as you would expect.

Although the range could benefit from a sporty three-door diesel hatchback, there's little doubt that the Mazda3 diesel will continue to be a significant variant. Expect the Mazda bandwagon to keep on rolling.