PROTON has released Australia's lowest-priced new car at the drive-away price of $11,900.

The Malaysian-built 1.6-litre Proton S16 sedan goes on sale next month.

Equipped with a single driver's airbag, the S16 has airconditioning, remote locking, power steering, and a single CD audio system.

The engine produces 82kW at 6000rpm and is mated to a five-speed manual transmission.

An automatic version will be released early next year.

Fuel use on the combined cycle is claimed to be 6.3 litres/100km.