The renaissance of the small hatchback in the United States will get a further boost in summer 2006 when Nissan North America launches its new Mexican-built Versa at a starting price of around $US12,000.

A sedan version - a body style usually more popular with US buyers - follows in late 2006. Competitors will include Kia's redesigned Rio line, recently launched in both hatchback and sedan forms.

The Versa will also take on the upcoming Toyota Echo-replacing Yaris and Honda Fit/Jazz as well as GM's Korean-made Chevrolet Aveo and Toyota's Scion xA.

Versa doesn't replace Nissan's current entry-level model, the Sentra sedan - its 2007 model range will include fully redesigned Sentra and mid-size Altima lines and updated Maxima.

At a preview in Michigan, Nissan North America said the new Versa and Sentra will boost its profile in the US under-$20,000 sedan segments, which currently account for nearly 1.9 million annual sales.

It describes the Versa as an 'international' design (it looks rather like a Renault Megane from some angles), built on Nissan's advanced B platform. North American dealers will be supplied by the Aguascalientes, Mexico, factory, which also builds the current Sentra.

The model is badged Tiida in Mexico, Japan, China and other markets. It went on sale first in Japan in autumn 2004, with a 1.5-litre engine and CVT transmission developed jointly by Nissan and its stakeholder Renault.

US-specification cars will have a 1.8-litre DOHC inline four-cylinder engine developing around 120 horsepower and 125 lb-ft of torque. Fuel economy is estimated at a combined 38 miles per (smaller US) gallon with the optional 'Xtronic' continuously variable automatic transmission.

Nissan US said the design emphasises interior roominess, a high quality interior and comfortable, stress-free environment.

"The interior length, front to back, is over six feet [180cm) long - equal to or larger than some full-size luxury sedans," noted a spokesman. The hatchback and sedan also feature large cargo areas.

Standard and optional features will include intelligent key, Bluetooth hands-free phone system, satellite radio and Rockford Fosgate-powered subwoofer.

Graeme Roberts