Skoda has announced prices and specification for the new Octavia at the Birmingham motor show.

The range starts at £10,750 with the 1.4 16v Classic, while the range-topping 2.0 TDI PD Elegance with DSG transmission costs just £17,420.

These prices are significantly cheaper than the latest VW Golf, on which the Octavia is based.

Three engines will be available initially – 1.4 and 1.6-litre petrols and a 1.9 turbo-diesel. The 1.6 FSi petrol and 2.0 turbo-diesel follow soon after, with a 2.0 FSi model in early 2005.

Three trim levels are available – Classic, Ambiente and Elegance – and all models feature four airbags (front and side), ABS, central locking, tilt and reach adjustable steering wheel, electric front windows, electrically adjustable and heated door mirrors, and a four-speaker CD stereo.

Ambiente specification adds remote central locking, all-round electric windows, six-CD autochanger, climatic air conditioning and onboard computer. The top-end Elegance further adds climatronic two-zone electronic air conditioning, fog lamps, 16″ alloy wheels, cruise control, rear parking sensors, auto-dimming mirrors, rain-sensor wipers and an eight speaker stereo with 6-CD changer.

The new Octavia is better packaged than the previous model, and now boasts excellent boot and rear cabin space.

First deliveries will begin in mid-July.

The current RS performance model will continue in production until its replacement arrives late in 2005. Skoda insiders have hinted that a hot diesel model might be considered.