Renault will unveil a station wagon version of its Clio hatchback at the Frankfurt IAA in September, entering the segment for the first time.

The five-door car is based on the French automaker's third-generation Clio.

Its launch reflects growing demand for small station wagons among European buyers after Skoda's first-generation Fabia Combi, which was launched in 2000, proved so popular.

The Renault will rival the second-generation Fabia Combi, also due to be unveiled at the IAA, and Peugeot's 207 station wagon.

"It's a defensive move. The success of the first-generation Fabia Combi was so great that no one wants to miss out on the opportunity," said Christoph Stürmer, an analyst at industry forecasters Global Insight. "The B segment is highly competitive and you are fighting for every customer."

Style-conscious customers are increasingly demanding station-wagon versions of small hatchback cars rather than van-based vehicles, such as Renault's Kangoo.

Skoda's first-generation Fabia Combi proved to be a sales success when it was launched in 2000. Peugeot soon followed suit with a station wagon version of its 206. The 206 station wagon was recently replaced by the 207.

Analysts say station wagon versions of small cars are relatively cheap to produce because many body panels are shared with their hatchback siblings.

"Station wagon derivatives are a fairly inexpensive way to expand your lineup in a segment where portfolio expansion is the name of the game," Stürmer said.

Global Insight estimates the station wagon's share of the small car segment in Europe will increase to 6 percent in 2008 from 3 percent in 2007.