Such has been the success of the X5, you'd expect a slightly smaller, more affordable version to be a dead cert for BMW's number crunchers. However, the first X3 managed to miss the target as badly as an England penalty-taker.
The second generation has scored, however. BMW must have been severely embarrassed by the reception given to the original, because it has addressed every single flaw. Testers said the old one looked tall and spindly, had an uncomfortable ride and was poor value for money. So, BMW has completely changed the styling, giving it a much wider, sleeker look that finally does make it seem like a junior X5. The suspension has been redesigned to give a comfortable ride, without losing the reasonably sharp handling. Indeed the irony is that the more comfortable ride means you can drive it faster and actually use more of the handling. The value for money issue has also been addressed, by making a much better car without charging any more for it.
A further bonus is that both the manual models and (unusually) the automatic version have stop/start fitted as standard. By killing the engine at traffic lights and then automatically restarting it, worthwhile fuel savings can be made. Claimed economy is now over 50 mpg and CO2 figures are below 150 g/km, so it should be relatively economical both to run and to tax. It is also a lot more capacious. Interior dimensions are all up a bit and boot volume has grown by 70 litres - now it can carry quite a decent amount of gear.
The stereotype of German engineers is that they are never going to admit that they are wrong. Well, BMW might not admit in its press release that the old X3 was a mistake, but they must have been quietly listening to all the criticism. The second generation X3 is one of the biggest improvements we have seen in a long time. Instead of a car that felt like the X5's poor relation, the new X3, with its leather seats and i-Drive controller, feels like a premium product in its own right. Now the pressure is on the BMW X1 to justify itself...