Auto Express has gone deep into the Lion's den - and emerged with sensational scoops of Peugeot's new 207 in this week's mag. The mag's pictures show not only the supermini completely undisguised, but also its interior and an exciting new CC model.

Following on from our spy shots of the disguised model in issue 842, the images reveal all on the car that Peugeot hopes will become the UK's favourite supermini. However, with fresh versions of big rivals the Fiat Punto and Vauxhall Corsa coming soon, it won't be easy.

At the front, key styling cues from the current 206 - such as the steeply raked bonnet and curved headlights - are mixed with Peugeot's now trademark gaping grille seen first on the 407. The 'mouth' also features a protective black plastic bumper - just like the 107 - and integrated spotlights. A large bonnet badge completes the look.

On the inside, Peugeot has made even bigger leaps. Addressing criticisms over average build and material quality, the firm has borrowed much of the 207's dashboard and interior trim from the 407. Dominated by a huge 'soft-feel' facia cowl running from door-to-door, the newcomer gets a 407-style hooded binnacle. It houses the main dials and a centre console containing the stereo and air-con controls.

The LCD screen mounted above the central air vent is likely to feature on high-spec models, and will display sat-nav information. Peugeot is set to improve the current car's poor driving position, too, with reach and rake adjustment for the steering wheel likely. Expect decent headroom, particularly in the back, thanks to the tall profile. A sliding rear bench has also been mooted, but not confirmed.

Engineers will be keen to maintain the current car's reputation for fun, and the new model will be tuned to offer a compliant ride with sharp handling.

Engines will range from the current car's base 1.1-litre and 1.4-litre petrols, through to the new 1.6-litre units jointly developed with BMW. The GTi model is expected to feature a 2.0-litre with more than 180bhp. There will also be a choice of 1.6-litre and 2.0-litre diesels.

The 207 is set to get its official unveil at the Geneva Motor Show in March, with UK sales of the three and five-door kicking off in the summer. An SW estate model is expected to arrive later in 2007, along with the CC.

PARIS -- France's Peugeot launched its 207 compact car on Thursday, a drop-shape car with stylish touches, in a bid to tighten its grip on a very competitive market segment and reverse a trend of declining sales in Europe.

The 207 will go on sale in France in April and in other European countries before the summer and the car brand, part of PSA/Peugeot-Citroen, aims to sell more than 500,000 units next year -- the first full year of sales.

Frederic Saint-Geours, chief executive of Automobiles Peugeot, declined to unveil pricing details for the car but said it would be priced "competitively" in the market.

The 207 succeeds the 206 but Peugeot will continue to produce and sell the older model for many years to come.

Peugeot has sold more than 5.35 million units of the 206 since its launch in 1998, with peak annual sales of about 800,000 units.

"With the 1007 (a small compact with sliding door), 107, 207 and 206 we're holding a pack of aces," Saint-Geours said a day after Automobiles Peugeot posted a 1.6 percent decline in global unit sales in 2005 and a 5.4 percent drop in western Europe.

Declining sales in Europe, which accelerated in the fourth quarter, and a production ramp-up for new models saddled PSA/Peugeot-Citroen with excess stocks of vehicles.

The group headed by Jean-Martin Folz was forced to cut output and report a lower-than-expected operating profit margin for 2005, provoking a 2.7 percent fall in its share price. Its stock fell a further 1.2 percent on Thursday.

Christian Peugeot, a scion of the founders and communications director, said the so-called "B" segment for compact cars was growing fast. He said the market segment grew by more than 30 percent in the past five years and growth was expected to accelerate in the coming years.

FROM YOUNG BACHELOR TO ACTIVE SENIOR

Peugeot will market the 207 to young bachelors or couples, divorcees, active seniors or second-car buyers.

The 207 will be pitted against Renault's Clio III, voted Car of the Year for 2006, the new Fiat Punto, Volkswagen Polo, Ford Fiesta, Opel Corsa or Toyota Yaris.

Some 3.5 million vehicles were sold in 2005 in the segment which is further crowded with the Audi A2, Mazda2, Mitsubishi Colt, Nissan Micra, Rover 25, Seat Ibiza, Skoda Fabia and Smart ForFour as well as the C3 and Pluriel of sister brand Citroen.

Adding to the choices, the 207 will be offered in four styles -- casual, classic, sport and versatile -- with various equipment levels.

The cars have a distinctive front with a large grille that has the form of two smiling lips and long, angular cat eye front lights. It has an optional large sunroof and comes with six engine types which will be complemented with the powertrains developed in a joint venture with BMW.

The main instruments on the dashboard behind the wheel are in retro-design dials with chromium rims while other instrument indicators and a navigation system are on a central console.

But as with many cars in the segment, leg room remains limited and the trunk is not very big. The car is 4.03 meters long, 1.72 meters wide and has a height of 1.47 meters.

It uses the same platform -- chassis and components -- as the Citroen C2, C3 and Pluriel, but the sister models have more rounded form where the silhouette of the 207 is oval.

PSA invested 1 billion euros ($1.21 billion) in the new model which will be produced at Poissy in France, Madrid in Spain and the new Trnava site in Slovakia.

When Peugeot released the 206 CC in 2001, it went on to become the best-selling coupe-cabriolet for three years in a row. Even the 307 CC - despite weighing more than a small meteor - has been a popular little number during the past couple of years.

With this track record in shifting fashionable - if somewhat uninspired - coupe-cabriolets, it's no surprise Peugeot has announced that a folding-top version of the 207 will reach the UK next March.

The 207 CC has typical Peugeot coupe-cabriolet styling, with a low, sloped windscreen and high haunches. In fact, the CC sits 8cm lower than its fixed-roof cousin, giving it an even squatter and more feline appearance.

Believe it or not, the two-piece folding roof is brand new. Peugeot has done away with the irksome manual release of the 206 CC, making the operation fully automatic.

Peugeot says it has improved rigidity and safety, with strengthened upper panel and tubular reinforcement bars providing greater torsion and crash protection. The 207 CC also gets five airbags, including the modish driver's knee 'bag.

Trim levels are high, with aircon and sports seats as standard. There's the option of leather trim, a fragrance diffuser - seriously - and GPS satnav.

With the choice of one diesel and two petrol engines, the 207 CC's performance looks to be sedate rather than startling. Top of the range is the 1.6-litre turbocharged petrol unit with 150bhp, which Peugeot reckons will crack 0-62mph in 8.6 seconds.

A 120bhp version of the same block and a 1.6-litre HDi diesel with 110bhp bring up the rear.

A five-speed manual 'box comes as standard with all the engines, but the less powerful petrol model has the option of a four-speed auto 'box with Tiptronic control.

No word on prices from Peugeot at the moment, but expect the 207 CC to sell like, erm, the 206 CC when it goes on sale in March 2007.