The 2014 Toyota Yaris is now entering its third year on the market after updates in 2012. So how well has Toyota's smallest, cheapest car held up to competitors in the fast-moving subcompact segment?

Let's get the bad news out of the way first: The Yaris continues to use a 4-speed automatic transmission, which hinders both acceleration and highway fuel economy. Most rivals have five or six speeds by now.

But the Yaris does its best to compensate in other areas. Its feature content is a strength by subcompact standards. The interior is both stylish and spacious, a rare combination at this price point. And the suspension is surprisingly capable, delivering more fun-to-drive smiles than expected.

Indeed, the Yaris may not be a superstar, but it's a solid competitor with the added bonuses of Toyota's traditionally strong resale value and reliability. Last year's redesign continues to stand the Yaris in good stead.

What's New for 2014?

The Yaris enters the 2014 model completely unchanged after minor trim updates for 2013.

What We Like

Good overall fuel economy; standard Bluetooth and USB/iPod connectivity; accommodating back seat; stylish interior; nimble handling

What We Don't

Outdated 4-speed automatic transmission; noisy engine; steering wheel doesn't telescope

How Much?

$15,000-$17,000

Fuel Economy

The Yaris is powered by a 1.5-liter inline-4 rated at 106 horsepower and 103 lb-ft of torque. It's not our favorite engine in this segment. Noise is pronounced during acceleration, and there's not much get-up-and-go, either. A 5-speed manual is standard. We'd recommend it over the optional 4-speed automatic, which feels primitive to operate.

Fuel economy is a dead heat between the transmissions. The manual is rated at 30 miles per gallon city/37 mpg highway, while the automatic's rating is 30 mpg city/36 mpg hwy. While these highway figures are unimpressive for a subcompact, the city figures are robust.

Standard Features & Options

The 2014 Toyota Yaris is available as a 3- or 5-door hatchback. Toyota offers a Yaris sedan, but it's only available to fleet customers. Three trim levels are offered: L, LE and SE. The L and LE trims are available in 3- or 5-door body styles, while the SE trim is only available on the 5-door.

The base Yaris L ($15,000) is well-equipped with 15-inch steel wheels, air conditioning, a 6-speaker stereo with iPod/USB connectivity, Bluetooth, a tilt-only steering wheel (a telescopic function is unavailable), side-curtain airbags and a fold-down back seat.

The Yaris LE ($16,500) adds features such as a height-adjustable driver's seat, cruise control, a 60/40-split folding back seat and steering-wheel-mounted audio controls.

The sport-themed SE ($17,000) tacks on 16-in alloy wheels, unique exterior styling cues, sport fabric upholstery, a leather-wrapped sport steering wheel and special instrumentation.

Safety

The 2014 Yaris comes with standard stability control, nine airbags and whiplash-reducing front seats.

In government crash testing, the Yaris received an overall rating of four stars out of five, including four stars for frontal impacts, five stars for side impacts and four stars for rollover safety. The independent Insurance Institute for Highway Safety awarded the Yaris its top rating of Good in every crash-test category, including the roof strength test -- previously a trouble spot for this Toyota.

Behind the Wheel

There's no doubt that Toyota has upped the fun factor with the current Yaris. The steering is noticeably tighter and more responsive than before, and the car zips around with an eagerness that we don't remember from the previous car.

The raucous engine is a bit of a killjoy, though, and we'd hesitate to call the ride supple. In other words, the Yaris is something of a mixed bag from behind the wheel. Make sure you take it up to highway speeds during the test drive and try to find some bumpy pavement to sample, too.

The Yaris model's front seats are nothing to write home about, though the SE model's sport fabric upholstery does seem to add a bit of grip. A potential deal breaker for taller drivers is the tilt-only steering column, which requires a serious reach forward if the seat has been moved all the way back. We love the dashboard, though, as it has far more style than ever before, vaulting the Yaris to the head of the class in this respect. The materials aren't bad, either. No, the plastics aren't luxurious, but at least they have distinctive grains and everything seems to be bolted together well.

The Yaris model's legitimately accommodating back seat is proof that subcompacts don't have to punish rear passengers. Even full-sized adults can ride back there for a while without complaint. Kudos to Toyota's engineers for figuring out how to make this happen in such a tiny car.

Other Cars to Consider

Chevrolet Sonic -- The Sonic excels at cruising on the highway, and it has some neat interior touches, not to mention superior power and fuel economy with the 1.4-liter turbo. A tough competitor for the Yaris.

Kia Rio -- Blessed with possibly the best-looking exterior and interior of any subcompact, the Rio is the runway model of this group. It's a pleasant drive, too.

Toyota Prius c -- If you've got up to $20,000 to spend and want to use less gas, check out the new Prius c, which is based on the Yaris but runs at an insane 50 mpg.

AutoTrader's Advice

We think the base Yaris L model gives the best value. But pay attention to the height of the driver's seat, because it's not adjustable in the L; you'll need the LE for that.

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