An all-new Toyota Corolla sedan has finally arrived almost 18 months after its hatchback sibling went on sale.

Priced from $20,740 plus on-road costs it's designed to take the fight to the just-released Mazda3 and the rest of the small-car pack, the biggest segment of the new-car market. Toyota and Mazda have replaced the Holden versus Ford battle as their small cars compete for top-seller status.

The Toyota Corolla may be the reigning champion, becoming our favourite car last year, but the Mazda3 has more appeal with private buyers and was Australia's favourite car for the prior two years.

The Corolla is typically a favourite among small fleets, rental companies and can be found in the car parks of nursing homes. But Toyota is hoping that the new Corolla sedan's sharp new looks will appeal to younger buyers.

VALUE

The new, 11th generation Corolla sedan is the first Toyota passenger car to come to Australia from Thailand (we've been sourcing the HiLux ute from Thailand for decades and, for now, the Corolla hatch still comes from Japan). But don't expect a discount thanks to the Free Trade Agreement with Thailand that eliminates the 5 per cent import tariff.

Toyota has instead chosen to load the new Corolla sedan to the hilt, with features previously reserved for luxury cars; a rear view camera and parking sensors are standard even on the most basic model.

That's why the Corolla sedan starts from $20,740 plus on-road costs compared to the $19,990 starting price for the hatch that wound back prices almost 20 years.

"We've chosen to price the car to the market, the sedan customer is a very different customer to the hatch customer," said Toyota Australia executive director of sales and marketing, Tony Cramb, at the launch of vehicle in Launceston today. "By our estimates, 85 per cent of these customers won't cross-shop these vehicles.

Toyota says the new Corolla sedan is still sharp value because the starting price is actually $250 less than the previous model launched in 2007, and the Consumer Price Index has since risen by more than 20 per cent. By Toyota's calculations the true cost of the Corolla sedan should start in excess of $25,000.

The range starts with the Corolla Ascent ($20,740) which apart from the 15-inch steel wheels and plastic wheel covers, is generously equipped (in fact, this wheel and tyre combination might not look impressive in the brochure or in the showroom but it helps the base model sedan drive better than the base model hatch, but more about that later).

Standard fare includes a rear camera and rear sensors, believed to be a first for the class in this price bracket. Some other small cars don't even come with rear parking sensors. Tut-tut.

Seven airbags, cruise control, Bluetooth and a large touch screen for the audio system are also standard fare. One small blot: only the driver's window has one-touch "auto up" or "auto down" functionality, the other windows require a finger to be held on the switch to wind the glass up or down.

The next model up, the SX ($22,990) gains 16-inch alloy wheels, front parking sensors, a sensor key with push-button start. Automatic adds $2250 to both the Ascent and SX. The top-of-the-range ZR ($30,990) is an auto-only proposition, and comes with LED headlights, electric seat adjustment, leather seats and satellite navigation.

There are six colours available but all but one of them incurs a $450 premium for metallic paint. Toyota used to charge less than $300 for this but the price has crept up to (a) keep the RRP low, and (b) to get closer to the prices charged by some rivals (Holden stings $550 for sparkles in the paint, Mazda doesn't charge for it at all).

TECHNOLOGY

The Corolla sedan reportedly has "bamboo fibre" audio speakers to go with a 6.1-inch touchscreen that links popular phone apps and other functions. The top-end model comes with traffic alert and, when tethered to a phone, will use Google search to find nearby restaurants, local weather, petrol stations and other points of interest.

DESIGN

No body panels are shared between the Corolla sedan and hatch. In fact, the 'twins' are a different length, height and width from each other. The result is a longer, roomier Corolla sedan than before. The distance between the front and rear wheels has grown by 100mm, which has given back seat passengers more leg room and created a bigger gap between those in the front and back seats.

The new Corolla sedan has a bigger boot (470 litres, up 20 litres), although "goose neck" hinges still impinge on luggage space when the boot is closed. At least the back seat spilt-folds 60:40 to stow bulky items, and the boot aperture is larger and the space between the wheel wells is wider.

The sharp creases on the front and rear bumpers are not just for looks, they're designed to help the Corolla sedan slip through the air more efficiently. Toyota also paid closed attention to the interior. "Since many competitors have upgraded interior quality we made this a particular focus with more detailing and soft-touch materials," said the chief engineer for the Toyota Corolla, Shinichi Yasui.

Room for improvement? A digital speed display would be welcome across the new Corolla range (there is a display screen next to the analogue speedometer already there for other functions, it would be good to have an additional mode). And, oddly, the shiny interior door handles reflect in the side glass and slightly obscure the side mirrors.

SAFETY

Seven airbags (including one for the driver's knee) and a strong body structure equate to what should amount to a five-star safety rating. All seats have height adjustable headrests and lap-sash seat belts, to prevent whiplash in a crash.

As mentioned earlier, every new Corolla sedan has as standard equipment a rear camera and rear sensors, believed to be a first for the class in this price bracket. Some other small cars don't even come with rear parking sensors. Toyota deserves kudos for going all the way with the sedan, even on the cheapest models. Now it just needs to do the same on the RAV4 SUV range and the Corolla hatch.

DRIVING

Toyota proudly says it tuned the steering and suspension on Australian roads, which presumably is why the company chose the demanding roads of Tasmania for the media preview. It's a bold claim given that Toyota isn't exactly known for its dynamic handling or road-holding. But first impressions of the new Corolla sedan are good.

The base model Corolla sedan actually drives better than the base model Corolla hatch. I thought it was a figment of my imagination, but a quick check revealed that the Corolla sedan is on slightly narrower and slightly smaller in diameter 15-inch tyres.

The tyres, combined with a larger overall footprint, mean the base model Corolla has a supple feel over bumps and yet nicely responsive and sure-footed in corners.

On smooth bitumen, the tyres and the engine are relatively quiet. But on coarse chip back roads at highway speeds there can be a bit of tyre roar, not unusual, not unbearable and not a deal-breaker in my opinion.

The seven-speed continuously variable transmission didn't drone or over-rev as much as other CVTs because Toyota has added a torque converter to it. I don't pretend to know how it works but, in practice, it appears to be better than other CVTs and doesn't feel or sound like it's struggling.

In every other regard, the Corolla is entirely predictable which, for familiar buyers, is a good thing. All buttons and dials are well placed and easy to use. Visibility all around is good, although it's even easier to park now that it has a rear camera as standard (helpful, too, given that it's the biggest Corolla ever built).

VERDICT

After a mildly disappointing effort with the Corolla hatch, Toyota has upped the ante with the Corolla sedan. It's one of the best equipped cars in its class for the money and the Toyota quality is ever present. Unlike some Hondas, you'd never pick this Japanese car came from Thailand.