Cut-price BMW 3 Series on the way

BMW will soon launch a new entry 3 Series sedan variant that will lower the price of entry by $5500 and substantially undercut its main German rivals - the Mercedes-Benz C-Class and Audi A4.

Set for local launch in June, the 316i will be priced from $50,900 plus on-road costs, which BMW says makes it the cheapest new 3 Series variant since the E36 318i from 1995.

Power will come from the same 100kW/220Nm 2.0-litre turbo engine as the top-selling 116i and 118i hatch matched to an eight-speed automatic transmission.

The starting price is not only $5500 less than the current entry-level 3 series, the 318d diesel, but also $7700 cheaper than the current base 320i petrol.

Fears of it being a stripped-out base variant are unfounded, since BMW Australia claims the specification levels will be the same on the 316i as the base diesel.

While the 316i will be less powerful than auto-equipped base versions of the Audi A4 (125kW/320Nm) and Mercedes-Benz C-Class (the 135kW/270Nm C200), it will also be $4600 and $9000 cheaper respectively.

Despite the sharpened price, BMW Australia head of product planning Toni Andreevski said the variant will be no 'stripper'.

Standard kit is expected to include 16-inch alloys wheels, climate control, Bluetooth phone and audio, leather steering wheel, rear parking sensors and a 6.5-inch display.

The 3 Series is currently engaged in a tight tussle with the C-Class for segment sales supremacy. For the first two months, the Benz leads the BMW with 782 sales to 695.

BMW acknowledges it could close this gap, or even skip ahead of Mercedes-Benz with the new entry variant bolstering numbers.

The challenge, according to product communications manager Scott Croaker, is securing extra allocation of vehicles, with the company already selling all the 3 Series models it can get.