For a car aimed at the young and trendy, SEAT couldn't have lucked into a better name than Ibiza. In 1.2-litre guise, it's a car that's still affordable even after you've booked your annual two-week bender in San Antonio, yet will never resemble the automotive equivalent of a bucket shop ticket.

When SEAT originally launched the Ibiza in 1984, they were hugely proud of the fact that it was their own undertaking and not merely a reheated Fiat. Okay, so they had a little hand from Porsche (and milked the subsequent PR opportunity) but as a first effort it was extremely good. At that time, Ibiza was just another buckets and spades Mediterranean destination. As the island's resorts developed into a sort of Mecca for holiday hedonists, so the Ibiza also became big business, attracting more new buyers to the SEAT family than any other product line. The latest version offers fun, a little Latin spirit and - a notion alien to many of the spaced-out Balearic clubbers - a little sophistication.

The 1.2-litre version that we examine here is fitted with a high-tech three-cylinder lightweight alloy engine that generates a modest 69bhp. This may not add up to a whole hill of beans for a modern engine but it does go some way to endowing the little SEAT with a decent fuel economy average of some 47.1mpg and a low carbon dioxide emissions figure. If you're interested in all out performance, the Ibiza isn't going to do a great deal for you with 60mph appearing in 14.7 seconds. The top speed's a respectable 103mph, but this is a quality supermini with the commensurate safety features that all tend to add weight. If you want a quicker 1.2 we'd recommend a Suzuki Bandit motorbike, but aside from that, you'll not find too much to touch the little SEAT.

"Compared to its predecessor, the Ibiza is a dramatic improvement."

Available solely in Reference Sport trim, the Ibiza 1.2 also offers the choice of either three or five doors in a package that starts at £8,695 for the base three-door and tops out at £9,325 for the five-door. Even though this model props up the Ibiza range, buyers can expect to find big car features like tinted glass, a body-coloured rear spoiler, remote central locking, a six-speaker stereo system, one touch electric windows, a split-folding rear seat, electro-hydraulic power steering, a pollen filter and twin front airbags.

The Ibiza of today carries the effects of a facelift which edged the car closer to its newer SEAT stalemates on aesthetic grounds. Aggressive air-intakes are now evident, carved into the lower reaches of the front bumper. These evoke the ones on the SEAT Leon World Touring Car and emphasise the link that that the brand is always keen to make between its production models and motorsport ventures. Twin headlamps are also fitted as standard to all Ibizas, as are wheels of at least 15" in diameter - even on this entry-level model - but it's round the back where most alterations have been made. The bumper is reshaped to incorporate a mock diffuser, another nod to SEAT's motorsport activities. As with all modern SEATs, the Ibiza displays its name centrally on its tailgate, below the large SEAT badge which doubles as the boot release.

Inside you'll spot a number of VW Group parts, reappearing like old faces at a school reunion. The window switches, the gear knob, the ventilation controls and so on are all sourced from that bottomless well that's disparagingly termed the VW parts bin, and are none the worse for it. The roofline is lower than we've become used to in Polo and Fabia variants and the rear legroom is less, but otherwise the cabin holds few surprises other than a rather novel textured plastic that's softly abrasive but not particularly great looking.

Compared to the previous generation model, the Ibiza is a dramatic improvement. Not only is it far prettier, especially with the latest facelift, it also utilises its cabin space better and the perceived quality has been ratcheted up a good few notches. None of these factors, however, differentiate it hugely from its rivals. SEAT point to the fact that the Ibiza's based around the 'Agile Chassis' concept developed in house. This combines suspension settings tuned for the keen driver with an intelligent power steering system that not only adjusts the amount of assistance according to driving speed - nothing particularly novel there - but also considers the position of the wheels and how quickly the steering wheel is being turned. Other small cars with power steering often incur 'pumping loss' when being driven enthusiastically, that is the inability of the engine-driven power steering pump to keep up with the demands the driver places on the steering. This leads to inconsistent steering feel and the helm weighting up just when you don't want it to. The Ibiza, by contrast, uses an electric pump that runs independently of the engine to power the steering. The result? Better feedback and keener reactions when you up want to up the ante.

The Ibiza's driving experience has won praise from all quarters since its 2003 launch and was central to it collecting no fewer than three WhatCar? 'Supermini of the Year' awards over the proceeding three years. But is it all wasted on a car with just 64bhp to haul it about? Not at all. Although the 1.2-litre models may not be the last word in thumping acceleration they've still got enough verve to appeal to the fresh-faced target clientele. Moderation and Ibiza aren't too words that are commonly associated. Let's set a precedent.