BMW X3 - Compact Luxury SUV--Built in the U.S.

BMW has cachet--and its 3 Series cars have been the brand's most popular offerings for decades. With the rise in compact SUVs (and crossovers) it was inevitable that the German brand would expand into that segment, and in 2004, they did, offering the original X3 alongside the larger X5.

I drove one of these first-gen cars and and it didn't feel as "BMW-like" as I expected. I read elsewhere of complaints about the overly firm ride and a kind of plainness to the design.

Well, folks, don't worry, because the new X3 is completely BMW--even though it is now built in Spartanburg, South Carolina. BMW started building the Z3 sports car there a long time ago and it's now the source for all the X vehicles--X5 and X6 included. Americans are the largest consumers of tall wagons, and it only makes sense to build them here--for worldwide distribution.

BMWs are some of the most distinctive cars on the road, so you'll immediately recognize the twin-kidney grille, and all of the brand's X-series "Sports Activity Vehicles" have recognizable shapes to clue you in. The new model still has lots of lines on the surface, including six on the hood alone, but it's a little smoother and prettier than before. The headlight assemblies are large and prominent while the taillamps wear the T shape that was established in the first generation. The sides have three sets of lines to take your eye along the surface.

My Space Gray Metallic test car arrived with the inline 3.0-liter 6-cylinder engine, as the X3 xDrive35i. It has an even 300 horsepower--which felt like lots. It's reputed to go from zero to 60 mph in just 5.5 seconds. I didn't time it myself, but it felt like it was up to the job.

The eight-speed automatic has two extra gears, so there's a taller one for more efficiency while still giving you a quick shot off the line in the lower gears. You can shift manually (no clutch), too.

The xDrive28i model sits below the xDrive35i, and now comes with a turbocharged 240-horsepower four-cylinder for increased efficiency and a little lower initial cost.

The EPA gives the X3 with the straight-six ratings of 19 City, 26 Highway and 21 Average. I got just 17.4 mpg. Green Vehicle scores are a mid-pack 6 for Air Pollution and 4 for Greenhouse Gas.

Thanks to the electronic control of pretty much everything in the car, you can configure the driving characteristics with the Driving Dynamics Control lever. This optional feature lets you adjust the shock absorber firmness, engine throttle response, transmission shift characteristics, level of power steering assist, and stability control mode. That means that by setting it at Normal, Sport, or Sport +, you can have three quite different driving experiences.

Normal felt fine on the freeway and around town, but I tried the sportier settings intermittently, and it really made a big difference. Especially with a tall vehicle, having the tauter handling on the windier roads was a treat. Of course, it being a BMW, even Normal was more satisfying than the average car.

The first generation may have seemed a little basic and plain, but this new X3 has all the feeling of a BMW, including the straightforward, flat instrument panel and the typical matte surface textures that convey understated luxury. There was plenty of Fineline Sienna wood trim in my tester, too. The always-excellent BMW seats are firm and hold you in place while you're testing to see if that 5.5-second time is accurate.

The X3 isn't a cheap car to begin with. The xDrive35i starts at $43,595, but there are lots of extras you can pack on, and my tester was a rolling example of how to do this. The Sport Activity Package upgraded the wheels to 19-inch double-spoked alloys and enhanced the transmission and seats, while turning the headliner black and installing Aluminum Satin roof rails. Two Cold Weather Packages (neither of which I'd need here in California) heated the steering wheel and front and rear seats, among other things.

The Dynamic Handling Package gave me that adjustable ride and driving configuration I mentioned earlier. The Premium Package further loaded the boat with a power tailgate, keyless entry, ambiance lighting and much more. Premium Sound upgraded the audio system and added Satellite Radio. The Technology Package added lots of cool things you'd want to have, such as the rear view camera with a special "Top View" feature, Park Distance Control, and a navigation system with realtime traffic information. Whew.

What happened is that a $43,000 car became a $56,295 one. Compact, but loaded. What's not to like (other than making the payments?).