For years, Kia’s entry-level model hasn’t been much more than cheap wheels. Sure, the Rio5 hatchback tried to put a sporty spin on things, but it wasn’t ultimately wasn’t all that convincing. Time has also marched on in the subcompact segment with more modern drivetrains, safety gear, and better driving dynamics. In other words, it’s time for a new Rio.

Kia recently dropped off a near-production Rio 5-door hatchback for us to try. It shares a lot with its corporate-mate, the redesigned 2012 Hyundai Accent, including the platform and powertrain. Both cars feature a 1.6-liter four-cylinder engine paired with a six-speed manual or automatic transmission. For 2012, the Rio gets a boost in both power and fuel economy. Styling is a welcome departure from the dumpling-like previous version. A full compliment of safety equipment, including mandated-for-2012 electronic stability control, is standard.

First impressions? The Rio is much more entertaining to drive than previous Rios, and even the 2012 Accent sedan that we have in our test fleet. It reminds us of a Mazda2 with slightly less steering feedback but considerably more refinement. In a class known for Spartan frugality, there are lots of relatively high-end options, including a backup camera and a power sunroof. (The Rio in the video has a mixed set of model features. For example, the automatic climate control shown in the video probably won’t make it to dealers’ lots here.) Kia’s Uvo voice-command technology works well, with a flatter menu-structure than Ford’s Sync system.

While 2010 was the year of the small sedan, with many new rivals showing up all at once, next year seems to be the year of the subcompact. For example, Chevrolet’s new Sonic tries to wash away the sins of the old Aveo; our first impression is that it’s a much more appealing and substantial car. And Nissan will soon launch a redesigned Versa sedan. We’ll buy a Rio to see how it stacks up to the new Accent, Sonic and Versa as well as our earlier tested Ford Fiesta and Honda Fit.