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In Road & Track's first test of the new 1984 318i, in its July 1983 issue, the first of the second-generation "E30" 3 Series, the most startling thing about it was the price tag. At an as-tested $18,210, this 318i was more than double the price of a 1977 320i — and in general specification the newer car wasn't much different from the older one...at least in two-door form.

While again an evolutionary change, the E30's styling offered significant aerodynamic benefits over the E21. The grille was now less radically angled and the headlights were almost flush with it. In contrast to the flat hood of the E21, the E30's sloped gently and the car was otherwise more rounded and slick. There wasn't much difference in size, either, with the E30's wheelbase stretching a mere 0.3 inches from the E21's 100.9 to 101.2, and overall length actually dropping slightly. But what many buyers noticed first about the E30 was how substantial and tight the car was. Knowing that the "Baby Mercedes" was on the way, the E30 engineering team had redoubled their efforts on build quality and dependability, which were traditional Benz strengths.

With 101 horsepower from its 1.8-liter injected four, the 1984 318i two-door was an innocuous start for the E30. But almost immediately following that car was the 325e, which featured a 2.7-liter version of the inline six-cylinder engine first introduced on the larger 528e sedan. With a high compression ratio, but a low redline and economy-minded gearing, the "eta" 2.7, like all BMW sixes, was smooth and elegantly torquey in the company's smallest car, but hardly sporting in character. But its 121 horsepower were the most BMW had offered to U.S. buyers since the 2002tii, and the car was decently quick, making it to 60 mph in 8.9 seconds and completing the quarter-mile in 16.6 seconds at 81.5 mph for Road & Track (the 318i did the same deeds in 11.6 and 18.3 seconds for the same magazine with a 74.0-mph trap speed in the quarter).

The four-door arrived for 1985, and along with it came a new four-speed automatic transmission available with either the four or the six. By 1986, the demand for the four-cylinder 318i had dried up, and it was dropped from the lineup, but antilock four-wheel disc brakes were now standard and a better-handling, sportier-looking 325es two-door joined the line.

The E30 really came of age in the 1987 model year with the appearance of the 325i and 325is models, which abandoned the eta reduced-rev/high-fuel mileage engine concept and the introduction of the 325iC Convertible, the first pure convertible offered in the 3 Series. "The new 325is is the first genuinely sporting BMW to reach our shores since the 2002tii went out of production in 1975," wrote Car and Driver upon testing the '87 325is. The 325is engine, though part of the same M20 family as the eta engine and having the same 84mm bore, had a 75mm stroke (down 6mm from the eta) to drop displacement from 2,693 to 2,494 cubic centimeters. That short stroke was one element that opened the rev range a full 500 rpm higher and pushed the output to 168 horsepower and 164 pound-feet of peak torque — easily the most powerful 3 Series to that moment. Car and Driver's 325is blasted to 60 mph in just 7.4 seconds and completing the quarter-mile in 15.6 seconds at 88 mph. So gratifying and ingratiating was the new 325i engine that most reviewers felt the car was worth its soaring price tag. In the case of Car and Driver's 325is, that tag read $27,475 — which the magazine pointed out is, taking inflation into account, double the price of the old 2002tii.

BMW's Motorsport division had gotten its start in the early '70s creating high-performance street cars, as well as race cars. By 1987, the reputation of the Motorsports division for building brilliant sporting machinery was well established. And yet entering 1986, it had never really played with the 3 Series.

The original M3 made it over to the United States 1988. Originally built to take on Mercedes' Cosworth-tweaked 190E 2.3-16 in FIA Group A racing, the M3 employed a 2.3-liter four-cylinder capped with a twin-cam four-valve head that was essentially one of the big six four-valve heads less two cylinders. Dropped into a modified 3 Series two-door body shell (the flared fenders, more steeply raked rear window and higher trunk lid meant only the hood was left untouched from more plebian 3s), the Bosch fuel-injected "M Power" four was rated at 192 horsepower at a wailing 6,750 rpm when it finally got to North America. "This is not a car for yuppies," wrote Car and Driver on their first exposure to the U.S.-spec M3. "This is a car for us. In case you haven't noticed, BMW's U.S. lineup has blossomed to include a dazzling array of leather-lined hot rods that beg to be flogged through the twisties and hammered on the superslabs." Stirring the five-speed manual transmission, Car and Driver blasted that 2,857-pound M3 to 60 mph in just 6.9 seconds, blitzed the quarter-mile in just 15.2 seconds with a 92-mph trap speed and screamed to a 141-mph top speed. With an as-tested price of $34,810, the M3 was at that time (and still in many minds) the ultimate BMW 3 Series.

BMW would build an all-wheel-drive 325ix model in 1988 as well, and the Motorsport fanatics would conjure up "Evolution" models of the M3 for those who found the wonderful original only a good starting point. But with the introduction of the M3, the possibilities of the E30 3 Series were thoroughly and gloriously exhausted as it faded out of production through 1991.

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