Despite the small 1.3-liter engine and meager 82 horsepower output, the Jazz performs impeccably well, exhibiting a spirited performance even better than that of the City sedan.  This is because of the Jazz’s lighter curb weight, improved dynamics and European spec suspension.  The manual gearbox gives short and precise shift actions uncanny for a car in this class (though the clutch is a bit jerky), but it’s the silky smooth 7-speed Continuously Variable Transmission or CVT that’s best paired with the frugal I-DSI engine.  Without getting into the nitty-gritty of how CVT works, it simply translates to an ultra-smooth on-road performance.  Though fuel economy figures north of 20 km/L would require a feathery touch on accelerator, lead foots will still manage to squeeze out 12-15 km/L easy (our driving netted us 13.87 km/L on the manual and surprising 17.21 km/L on the CVT).  The CVT also allows the driver to concentrate on braking—which is a goof thing, because the pedal feels a bit spongy.  Sadly though, the safety package inclusive of dual airbags and anti-lock brakes with electronic brakeforce distribution, won’t be available in the 2005 Jazz 1.3 S.  It’s standard equipment though on the sportier 1.5 VTEC.

Thanks to the revised suspension settings and lower ride height, the handling package of the Jazz shows a hint of sporty performance, while remaining grown-up.  The ride borders on firm, but remains comfortable (thanks again to the bum support).  It’s good and well damped except when hitting road joints, where the Jazz’s short wheelbase becomes apparent.  The Jazz tackles corners with just a hint of understeer, all the while feeling composed even in the worse of crosswinds.  The Electric Power Steering or EPS improves high-speed stability too, much better than even the Mazda 3 2.0R, although the feel is a bit akin to an arcade machine.  With its small body and short overhangs, the Jazz easily darts through city traffic.  It’s helped by excellent visibility thanks to its large glass area and well-shaped side mirrors.

In the end though, with the various improvements on the Honda Jazz, it’s easy to forgive its shortcomings.  It is, the sub-compact, fully realized.  Think of it as the Honda City Version 2.0—a car that offers the same levels of refinement and convenience, but better packaged.  So there’s no reason for tit not to rule the sales charts here.  If Japan is any indication, it was crowned as the best-selling car—the first to beat the Toyota Corolla to the title in the last thirty years!  Feeling the fuel pinch, the American market, which usually snubs the hatchback, is clamoring for Honda to bring in a fuel-sipping sub-compact stateside.  And guess what, Honda is seriously thinking of bringing the Jazz there as well.

Interior is the same as Honda City, but Jazz gets an additional storage bin below the dashboard.  Two-tone leather steering wheel and shifter are part of extensive accessories line.
The innovative U.L.T. seats come standard on all Jazz's though.  A whole set of luggage can fit even without folding the seats, so just imagine the capacity with the seats down...
Though it only has a single cam and eight valves, but Honda's i-DSI gives unparalleled fuel economy thanks to low-end punch.  Funny, CVT gives better mileage than MT.  Maybe due to lead foots?

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