HONDA has finally launched its CR-Z coupe in Australia, where it will be a vital part in the struggling Japanese brand's hybrid strategy and spiritual successor to the fondly-remembered CRX of the 1980s.

The all-new CR-Z, which was revealed in concept guise atthe 2007 Tokyo motor show and was launched in Japan early last year, officially goes on sale here on December 1, with a two-variant model line-up starting at $34,990 plus on-road costs.

The expected 600 first-year sales will not pull Honda out of its current sales doldrums. Owing to natural disasters in Japan and Thailand this year it expects to sell only 30,000 cars in Australia, its worst year since 2003.

But the CR-Z does add a desirable, image-leading product to the Honda line-up that will help the embattled brand end the year on a high note.

Speaking at the CR-Z launch in Victoria's Yarra Valley today, recently appointed Honda director Stephen Collins said the brand is aiming the CR-Z at “responsibly indulgent” individuals including 30-something females and empty-nesters.

It may be late to Australia, but Honda is getting into the resurgent affordable small coupe market early and the CR-Z will be without any real competitor until the Hyundai Veloster arrives later this year or early next, followed by the likes of the Opel's Astra GTC, the Toyota 86 and Subaru's BRZ, which is yet to be confirmed for Australia.

For now though, Mr Collins said Honda is targeting customers who would otherwise buy the Audi A1 or Mini Cooper, which occupy a similar price bracket to the CR-Z, as do entry-level variants of the hybrid Lexus CT200h.

Honda claims a hybrid world first for the entry-level Sport variant's six-speed manual transmission, although the accolade relates to the number of ratios, as the pioneering original Insight of 2001 was fitted with a five-speed manual.

The well-equipped Luxury flagship ($40,790) is exclusively paired with an automatic continuously-variable transmission (CVT) with paddle-shift, which can be specified on the Sport for an extra $2300.

Mr Collins predicted a 60:40 split in favour of the generously-equipped yet reasonably-priced Luxury variant and said 75-80 per cent of customers were expected to opt for the for the CVT, with only enthusiasts likely to select a manual.

All variants get six airbags, active head restraints, seatbelt reminders, electronic stability control, traction control and anti-lock brakes with electronic brake-force distribution and brake assist, while manuals also get hill-start assist.

The level of standard safety equipment combined with good crash-test performance have earned the CR-Z a maximum five-star ANCAP safety rating, based on Euro NCAP test results.

Visibility is aided by daytime running lights, LED tail-lights and front foglights, while security is catered for by a standard alarm and immobiliser, which on CVT models is bolstered by a transmission lock.

In addition to all the safety and security kit, the cloth-seated CR-Z Sport comes with climate-control air-conditioning, rain-sensing wipers, cruise control and rear parking sensors with visual notification via the small instrument cluster-mounted multi-function display.

Like the multi-function display, the Sport’s standard six-speaker MP3 and USB-compatible CD sound system and Bluetooth phone connectivity can be controlled via the multi-function steering wheel.

In addition to a standard CVT automatic, the Luxury variant adds leather upholstery and heating for the front seats, satellite-navigation with SUNA traffic updates, Bluetooth audio streaming, a DVD player, panoramic glass roof and reversing camera.

Mr Collins said the high standard specification meant no factory options would be offered on the CR-Z apart from the five exterior colours, which comprise black, turquoise, red, white and silver.

Although the CR-Z was never designed with out-and-out practicality in mind, its modest 225-litre boot capacity can be expanded to a more useful 401 litres – sufficient for two golf bags – by folding the rear seats flat.

Both CR-Z variants are offered in Australia with a 2+2 seating configuration, unlike the US market where a two-seater with larger standard luggage capacity is available.

Dropping the rear seats can is achieved by pulling a single lever – which Honda says can be reached from the driver's seat – centrally located on top of the backrest.

Both variants are motivated 1.5-litre four-cylinder petrol engine that combines with a 10kW/121Nm electric motor borrowed from the Insight hatchback to produce a total power and torque output of 91kW and 174Nm, although the torque figure drops to 167Nm on CVT models.

Honda R&D large project leader Norio Tomobe said hauling the 1155kg (1175kg CVT) CR-Z from rest to 100km/h takes about 9.7 seconds according to internal test figures, while its top speed is in the region of 200km/h.

Combined fuel economy on the manual is five litres per 100 kilometres, while the CVT is slightly more frugal at 4.7L/100km – a tenth of a litre more than the Insight, which is not a bad trade-off for the extra performance over the 65kW/121Nm Insight.

CO2 emissions are 118 grams per kilometre for the manual CR-Z, with the CVT emitting 111g/km.

Mr Tomobe said the CR-Z project was referred to internally as cafe racer, a play on words simultaneously recalling the acronym for corporate average fuel economy and the motorcycle and car-culture phenomenon.

Compared with similar-sized competitors, the CR-Z – and related Insight – are not that frugal. For example, the Lexus CT200h officially consumes 4.1L/100km and Toyota’s venerable Prius sips 3.9L/100km.

However the CR-Z’s fuel figure looks good next to direct competitors like the Hyundai Veloster, which is claimed to consume 5.9L/100km, although the Opel Astra GTC fitted with a grunty 2.0-litre diesel – but not confirmed for Australia – returns 4.9L/100km.

In addition to the ‘Econ’ and ‘Normal’ driving modes available on the Insight, the CR-Z adds a Sport function, which illuminates the instruments with an angry red glow, increases the amount of assistance provided by the electric motor, firms up the electric power steering and sharpens throttle response.

As with the Insight, ‘Econ’ changes to a milder engine map and slackens throttle response to ease smooth driving while reducing use of the air-conditioning compressor and recirculating cabin air.

Suspension is by McPherson strut up front, with a torsion-beam set-up at the rear. The Insight-based platform has been shortened by 325mm, with the wheelbase truncated by 115mm, while the track has increased by 45mm.

The lower front suspension arms are made from aluminium, saving 4kg in weight over the Insight but also increasing strength to counteract the increased stress caused by the CR-Z’s wider track and larger, wider 16-inch alloy wheels – claimed to save a further 5kg compared with the Insight.

Honda claims the use of a torsion-beam rear-end – a configuration not usually associated with optimum road holding – enables the nickel-metal hydride battery pack and control unit to be mounted lower, beneath the boot floor.

The configuration is claimed to help lower the CR-Z's centre of gravity by 30mm compared with the Insight and help achieve 60:40 front/rear weight distribution.

The CR-Z (which stands for compact renaissance zero) pays tribute to the CRX that inspired it, particularly with the swoop of its roof and split-level rear glass – an aerodynamic feature now common on hybrids – as does the car’s engineering ethos of frugal fun.

Honda CEO and President Takonobu Ito – who as a young engineer in the 1980s worked on the CRX chassis – recalled the '80s icon as demonstrating “that a car can be both sporty and fuel efficient”.

Inside the CR-Z is a sportier, more luxurious intake on the Insight’s already driver-focused layout, with soft-touch surfaces and high-luminosity silver accents – produced using a new vaporised tin-based thin-film technology – plus aluminium pedals and a redesigned steering wheel.

Like the Insight, the ventilation controls are mounted in a pod just to the left of the steering wheel.

The CR-Z’s instruments are based around a large rev-counter with central digital speed readout and, like the Insight, the back-lighting changes colour from blue to green (unless in Sport mode) depending on how efficiently the car is being driven.

Either side of the main dial are panels providing the usual fuel level, engine temperature and battery charge information, with feedback on driving style and encouragement for a gently-does-it approach provided on the small multi-function display.

Manual variants also get a display advising the best time to change up or down a gear for maximum economy.

Using the steering wheel-mounted controls, the multi-function display also enables the driver to scroll through various modes, including average or instant fuel use, journey time and average speed.