HYUNDAI is the first light-SUV seller to offer a two-wheel drive alternative locally.

Pitched at the booming small-car segment, the new Tucson City loses rear-wheel drive, two cylinders, $4000 and 158kg over the existing base model, the $29,990 V6 4WD.

The loss of weight and rear differential also dictates a revised multi-link rear suspension using a lighter rear cross member and longer lateral links for better on-road front-wheel drive dynamics.

At 58 litres, the fuel tank is also smaller than before.

Cribbed from the Elantra small car is the Tucson City’s 2.0-litre four-cylinder engine offering 104kW of power at 6000rpm and 184Nm of torque from 4500rpm.

In contrast the continuing 2.7-litre V6 delivers 129kW at 6000rpm and 241Nm from 4000rpm.

Like the V6, a four-speed automatic – now with lower gearing via a lower ratio differential – is the sole gearbox on offer. It features a sequential clutchless manual mode.

The official ADR 81/01 combined city and highway cycle is 9.2 litres per 100km, compared to 11.0L/100km for the V6.

External differences between the two run to monochromatic bumpers and door mirrors, the deletion of the plastic body cladding and ‘AWD’ badge for a ‘City’ one and a single exhaust.

Inside there is improved CD audio accepting MP3 and WMA applications, a redesigned cargo blind, leather-trimmed gear knob and steering wheel, improved driver’s seat and sun visor adjustment and revised fabric and trim.

Equipment levels mirror the V6 models, and include four-wheel disc and anti-lock brakes with electronic brake-force distribution, traction control, dual front airbags, air-conditioning, cruise control, keyless entry with alarm, power windows, roof rails, front and rear fog lights and 16-inch alloy wheels.

According to Hyundai, the Tucson City is creating a new sub-segment of the small-car market. Hyundai is following Ford’s lead with the rear-drive Territory, a vehicle that has outstripped initial sales estimates.

Apart from Hyundai’s desire to gatecrash the growing ‘premium’ small-car market, potential buyers of Honda CR-Vs, Toyota’s revamped RAV-4 and the related Kia Sportage are all in the Tucson’s sights.

The company also needs to spice up its small-car presence now that the XD Elantra is rapidly approaching its pensionable age.

As the Tucson’s City name suggests, urban buyers are targeted who cannot justify the expense and traditional thirst of an SUV. Hyundai’s research shows that two-thirds of SUV buyers live in or near the city.

They include couples 25-38 years old with small children, singles (mostly female) and retired folk and empty nesters.

As Hyundai points out, the Tucson is already significantly shorter than a Mazda3, making it easier to park in built-up areas.

The rest of the Tucson range was released in September last year.

There has been some size as well as sales overlap with the slightly larger and much-older (circa 1999) Hyundai Santa Fe SUV.

However this will be addressed later in 2006 by the second-generation Sante Fe.

The new Santa Fe will feature significantly different running gear – including a 3.3 and 3.8-litre versions of Hyundai’s new Lambda V6 engines as first sampled in the NF Sonata – as well as a significantly larger body that enables a seven-seater configuration.

In the meantime though the Tucson City will bring new rivals as well as customers to the Hyundai fold.

"We are expecting growth in this segment. Rivals will follow," says Hyundai’s director of sales and marketing, Theo van Doore.