We like
Surprising all-wheel drive traction, accomplished six-cylinder engine, rewarding on-road manner, SOS button peace of mind

Room for improvement
Ground clearance, firm 2.0-litre ride, no keyless entry for 2.0-litre

Price and equipment

BMW may be a familiar brand in the luxury medium SUV market, but it is not without a close rival, and any manufacturer would be unwise to rest on its laurels. It is by no coincidence that the entry-level $61,100, before on-road costs X3 is priced just $2500 cheaper than the Audi Q5 range-opener.

But the strong-selling pair have widespread competition from the likes of Land Rover's Discovery Sport and the the Volvo XC60 which start at $53,330 and $57,890 respectively.

And if that wasn't enough heat, Mercedes Benz is coming to the party next year with its GLC and an accompanying coupe version to do battle with BMW's X4.

In addition to its competitive pricing, BMW maintains the appeal of its facelifted X3 range with four engine options including two petrols and two diesels. The larger end of the SUV market is the only one in Australia that favours diesel power over petrol so our focus was on the $64,700 xDrive20d and the range topping $77,700 xDrive30d.

Both variants are well equipped with navigation, cruise control, parking radar all-round, reversing camera, bi-Xenon headlights, dual-zone air conditioning, electric tailgate, leather sport steering wheel, electric front seats and Bluetooth.

Interior

Materials manufacturers have made impressive ground in recent years and we found it hard to believe the chocolate-brown upholstery of our xDrive20d wasn't leather. BMW calls its synthetic hide Sensatec and it upheld the general feel of quality and craftsmanship associated with all the German car-maker's interiors.

Another feature often associated with BMW is the excellent seating position, made easier by the electrically adjustable front seats. Combined with the elevated driving position, the X3 offers a very comfortable place to be in either row of seats with a good view of the surroundings.

All versions of the X3 have keyless start so it is surprising, and sometimes frustrating, that not all have keyless entry. The technology is already in the key to allow engine start so surely it can't be that hard to extend the technology to door locking. BMW is not the only offender here and it will add the Comfort Access technology pack for $1100.

Stepping up to the 3.0-litre brings a significant amount more equipment starting with Nevada leather seats, which gain adjustable lumbar support and that unmistakable scent. The higher-spec car also gains the keyless entry absent in the lower grades.

The xDrive30d also builds on the all-round parking radar and reversing camera with the clever 360 degree birds-eye view.

The extra cash also brings a better sound system, larger 8.8-inch dash-mounted screen with more iDrive features and variable steering for a more involving drive.

Whichever variant you chose, both provide quiet and comfortable places for up to five people to spend time.

An electric tailgate was handy when approaching the boot with an armful of kit but its slow operation left us wanting the more traditional solution in a majority of circumstances.

We liked the 60/40/60 split-folding rear seats which allow a flexible use of the good-size boot (550 litres) without having to sacrifice all three rear seats until the full 1600 litre capacity is required.

The fully flat boot floor accommodated two swags, Esky and bags with room to spare and one rear seat still in place.

Our test car had an added optional $3000 panoramic sunroof which made the interior an even brighter place to be for all occupants.

Adding options to a BMW can be an expensive exercise but the X3's options list isn't as treacherous as some models.

Pumping up alloy wheels to a very bling 20-inches costs $1700, lowered sports suspension with torque vectoring is $700 and sports seats cost another $1000.

Engine and transmission

Kicking off the diesel engine offerings is the xDrive20d with its 2.0-litre four-cylinder. With 140kW and 400Nm, the smallest oil-burner is more than enough to drag the 1745kg wagon about with little fuss.

Its 8.1-second zero to 100km/h dash won't win any races, but for nipping around more urban settings the 2.0-litre is adequate, and many customers would happily live with the performance given its impressive 5.2 litres per 100km fuel consumption.

We managed a figure close to the quoted number thanks to a gentle foot and the standard idle-stop technology, but owners loading the X3 up with lots of family and things should expect higher fuel use.

As far as four-pot diesels go, the BMW effort is refined and quiet with no perceptible turbo-lag.

But the entry-level version stands in the shadow of its six-cylinder sibling.

With three litres at its disposal, the xDrive30d has a chunky 190kW and 560Nm with enough grunt to accelerate the X3 to 100km/h in just 5.9 seconds.

That generous torque is welcome at all speeds – overtaking is a breeze – and would handle the 2000kg braked towing capacity well. We particularly liked the soundtrack produced by the silky six and combined with its consistent power delivery and minimal turbo-lag, was a real delight to wind up.

Despite its useful power output, BMW says the six-pot will return combined economy of 5.9L/100km, which we think is a little optimistic. When cruising at freeway speeds we managed a best figure of 6.5L/100km.

At the end of our journey which encompassed on- and off-road exploration, some more enthusiastic driving and with luggage on board, the 3.0-litre used 8.3 litres of juice per 100km.

Both engines are bolted to an eight-speed automatic transmission which is a great match for either donk. Power uptake is efficient and flicks between the closely spaced ratios rapidly.

Manual selections can be made with steering wheel paddles but the auto program is intuitive enough to be left to its own devices a majority of the time.

About town and more urban areas, the 2.0-litre is perfectly adequate, well suited and very efficient, but for more adventurous work including towing or longer trips we would opt for the 3.0-litre. The sublime six is still one of our favourite diesel engines of all.

Ride and handling

BMW is renowned for creating models that are pleasant to drive and target the portion of motorists who put a premium on driving enjoyment. To that end the X3 is no different.

Both 2.0- and 3.0-litre versions have a refined ride which stays largely flat in corners and keeps occupants happy most of the time. We found the chassis just a little too firm over poorly maintained roads when piloting the xDrive20d, with the rear suspension skipping over imperfections.

Surprisingly, even though the xDrive30d has wheels one inch bigger than the 2.0-litre's 18-inch versions, the ride seemed more forgiving and comfortable.

Steering could be a little numb at times but was generally smooth and gave a good idea of what was passing underneath.

There are manufacturers out there who would like their cars to handle like an X3, let alone a high-riding SUV, but high-riding perhaps isn't fair because the BMW sits just 212mm off the road, and that figure would manifest itself later.

Some are quick to criticise BMW's X-cars for their lack of off-road ability despite aesthetics that suggest otherwise so we pitched the xDrive30d against some of Western Australia's most unforgiving terrain.

On unsealed trails the X3 was a pleasure, hauling gear through endless red dust without complaint. Even loaded up, the strong diesel had plenty of capacity and ate up kilometers with ease.

Steep climbs on dry rocky tracks were dealt with easily and even on faster slippery dust-covered roads the BMW did not put a foot wrong.

Where many four-wheel-drive manufacturers offer switchable drive-modes for differing terrain, the xDrive approach is different. The system is always engaged looking to find the most traction no matter what the prevailing conditions.

Even fine dry sand couldn't unstick the X3 and it was impressive to feel the combination of torque management between wheels and clever individual wheel braking maintaining traction over a very challenging surface.

Boggy wet sand finally found the limits of the xDrive system but faltering grip was not to blame. We feel that a more dual-purpose tyre would broaden the X3's capability even further.

Its relatively low ride-height is also a limiting factor off-road and makes the X3 liable to sit on its axles when the going gets tough, but the same feature also improves on-road handling. For a majority of applications, BMW has the balance right.

We came away form our all-terrain adventure quietly admiring the X3's abilities. It is at the top of the dynamic road-manner heap but doesn't do nearly as badly as many critics have speculated off road.

Safety and servicing

Like many vehicles in its class, the X3 offers a solid level of safety thanks to whiplash-mitigating active front headrests, curtain airbags for all occupants with side and front airbags for the two front seats, run-flat tyres, hill descent for safer steep surface negotiation, ESC, ABS, hill-hold and 'corner braking control'.

If all of that technology can't keep you out of trouble then the X3 also has an additional feature often overlooked, but we decided to test BMW's Intelligent Emergency Call.

Pressing the guarded, ceiling-mounted SOS button connects the vehicle to BMW's ConnectedDrive centre allowing occupants to talk to an operator. Passengers can then request help in a variety of incidents including breakdowns and collisions, for example.

As well as opening a communication channel, the X3 also transmits important information about the vehicle. Our operator could see our location, direction of travel, vehicle colour, whether any airbags had deployed and even if the engine was running.

In the event of a crash this information can be forwarded to emergency services, enabling them to identify the vehicle's position quicker and prepare to treat casualties before they have arrived at the scene.

For serious accidents where occupants may be unable to communicate, the X3 will automatically call the centre following any airbag deployment or if the fuel-pump safety cut-off has been activated.

The function does not require a mobile phone to be connected and is stand-alone.

We were surprised just how effective and comprehensive the system was, and would be very happy to have the SOS button there just in case.

The X3 scored a maximum five stars in ANCAP crash safety testing with a maximum 16 points out of 16 in side-impact, as well as top marks in the pole test.

Verdict

If you are after a mid-sized SUV with a little more luxury and prestige than most, the BMW X3 is well worth a look. Coming from the BMW stable, its accomplished on-road manner is perhaps no surprise, but the way it handles itself off-road is unexpectedly good.

We are certain most BMW SUV owners wouldn't ordinarily consider using the superb xDrive system to tackle anything more ambitious than a muddy camp-site, but the traction it finds on very tricky surfaces is truly impressive.

Its more on-road focused tyres and ride-height are the undoing of the X3 off-road, but thrown at some (probably overly) ambitious terrain, BMW's middle SUV child went a lot further than we were expecting.

Couple with that a choice of efficient but versatile diesel engines, car-like on-road handling, typical BMW build quality and likable looks, and you have a very well-rounded SUV package.

Rivals

Audi Q5, from $63,600 before on-road costs
Like the BMW, Audi's high-rider is available with a choice of two diesels and two petrols. Pricing is closely aligned with the BMW as are levels of specification. For those wanting a higher performance SUV, the four rings can also offer the feisty SQ5 for under $92,000.

Land Rover Evoque, from $51,495 before on-road costs
Another of Australia's favourite mid-sizer options brings a model from outside the German stronghold. The extensive line-up offers a choice of practical five door or stylish three door – a unique feature in the market.

Porsche Macan, from $88,000 before on-road costs
The Porsche might be the most expensive option in the segment but that hasn't stopped it selling strongly here, thanks to a combination of gorgeous Porsche styling and performance.