THE introduction of the new Mazda2 is expected to liven up the already booming mini-hatchback market and further increase sales in this once non-existent segment.

The mini-hatchback market is one of the rare growth stories in the Singapore passenger car market, unlike the volatile SUV (sport-utility vehicle) and large MPV (multi-purpose vehicle) segments, which peaked in 2006 and have since entered a downtrend because of high fuel prices. Mini-hatchbacks represent a stable market which has been growing steadily over the past five years.

In 2002, these vehicles accounted for only 3 per cent of sales in the total passenger car market. In 2003, they grew to 6 per cent. That surged to 11 per cent in 2004, 12.6 per cent in 2005, and 14.2 per cent in 2006. Up to the first half of 2007, the figure was 15.4 per cent.

The strong growth has come on the back of a burgeoning COE (certificate of entitlement) quota and a wide range of models. The Honda Jazz and the Hyundai Getz were first on the scene, in 2002 and 2003, and this was followed by models like the Suzuki Swift a couple of years later, as well as the Toyota Yaris, Kia Picanto and even the smaller Chery QQ.

Today, the Jazz continues to be the market leader despite being an ageing model due to be replaced very soon. Authorised distributor Kah Motor sells an impressive average of about 250 a month. The Swift also racks up credible numbers, with 90 to 100 sold each month.

These numbers do not include those domestic Japanese versions being offered by parallel importers, which will add an average of around 160 and 140 units respectively every month.

A few reasons for their popularity are its utility and good fuel economy - in the Jazz's case - and sporty handling and well recognised name for the Swift.

On the other hand, the Mazda2 is expected to move about 50 units a month, says Mazda Motor Singapore's marketing and sales manager Philip Lu.

'If you are looking for a new model which is exciting to look at and drive, there is only one answer,' he says. According to him, the emphasis in the small car market has been on utility, styling and fuel efficiency. 'But apart from this, a small car is also capable of generating a driver-and-car relationship, that is, it can be fun to drive, like the Mazda2.'

The third-generation five-door hatchback was unveiled here last week and it boasts snazzy new styling and European-style handling. There are two trim levels, with a choice of either a four-speed automatic transmission or a five-speed manual gearbox. Prices start from $60,000 and rise to $64,000 for a top-of-the-line model with six airbags, body kit and 16-inch alloy wheels.

Mr Lu says that like all Mazda models, the Mazda2 focused on styling and handling and this is what will entice buyers. 'For too long, this category of customers has been deprived of a good-handling car,' he said. 'Not any more.'

Industry watchers expect the mini-hatchback market to strengthen further because of the cars' trendy appeal and good manoeuvrability in a congested urban environment.