USED Peugeot 306 Hatchback (97 - 03)

The 306 is a pretty hatchback that set new standards for how small cars should drive. It has grippy handling and plenty of steering feel, as well as a controlled, absorbent ride, all of which helped the car to win plenty of awards in the mid-1990s.

The designers have tried hard inside, too, and the dash has a novel twin-glovebox design, but it looks cheap. The soft seats and offset pedals won’t suit everyone, either, and cabin space is average, although boot space is good.

These are tough cars, but they were last sold in 2001, so they are getting on a bit and need plenty of care. Service intervals are set at 20,000 miles or every two years for petrol engines from S-plates onwards, but it's best to keep to the 12,000 mile/yearly visits Peugeot suggests for diesels, whatever you’re driving.

Euro NCAP awarded the car three stars for occupant protection, but one star for pedestrian protection, which is disappointing.

The outstanding model is the 2.0 GTi-6 hot hatch. Quick, slick and rorty sounding, it proved a hit from its launch. Prices have dropped to make them a bargain, but performance hatches lead hard lives, and you’ll need patience to find one that’s never been crashed and has had caring owners.

The best of the rest is the 2.0 diesel Meridian. Initially a special edition, its popularity soon meant it joined the 306 range permanently. Alloy wheels, a smart body kit, half-leather seats, air-conditioning and a CD player make it an attractive package, and the 90bhp diesel is strong and frugal.

Otherwise, there are 1.4 and 1.6 petrols, a 1.9 turbodiesel and a non-turbo 1.9. Trim levels ran from L through LX and GLX, with XS and XSi covering a pair of rather feeble sports hatches.

The three- and five-door hatches are the commonest, but there was also a big-booted saloon (withdrawn in 1998) and a handsome cabrio. A face-lift in 1997 improved its looks and increased kit levels.

Prices are so low that future value losses scarcely figure in the equation. So depreciation, which is usually the biggest single contributor to your motoring bills, can be pretty much forgotten.

Servicing is cheap, but because you are buying an older car, you should budget for several repair trips a year. Luckily, most spares are inexpensive and easy to find, and you can expect any competent garage to tackle most jobs confidently.

Insurance costs are low, starting at group 4 for the 1.4. Most are groups 5 or 6, the XSi is group 12, the cabrio 14 and the GTi-6 15. Fuel economy is average – expect 30mpg from a 1.6 petrol. But, for the best, stick to one of the fine diesels - the 2.0-litre is capable of more than 50mpg.

Correct servicing is vital to ensure long engine life. The coolant needs changing every three years, otherwise corrosion sets in, and cylinder head blocks and gaskets blow. The timing belts need replacing at the same time to prevent engine damage.

Although service intervals are set at 20,000 miles or every two years for petrols from S plates onwards, a yearly oil change and brake service is best. So, check the logbook of any potential purchase to make sure that has happened.

If you’re buying a GTi-6, have it inspected first by a pro to ensure that it is not a write-off put back on the road. And, if you're buying that or a diesel, you can expect the suspension and brakes to need frequent work.

Rust takes hold on older models – check the lips of rear wheelarches for tell-tale signs - and look out for trouble with the electrics from perished connectors. Also, the airbag warning light may come on because someone has kicked loose cables under the driver’s seat, and the clutch cable can stick and cause premature clutch failure if it's ignored.