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In the everlasting journey to seek out fun and interesting cars from the ’80s and ’90s — you know, Radwood material — there are still a lot of options out there, some rarer than others. One ultra-’90s whip that encapsulates so much about the era, as well as what its brand was up to at the moment, is the neat (and somewhat odd-looking) BMW 318ti Compact.

The 318ti was for all intents and purposes a 318i coupe with its tail lopped off; the trunk was gone and replaced with a hatchback, the chassis between the front and rear wheels is changed up a tad, and the whole look is just quintessentially ’90s German. It was the entry-level Bimmer in the brand’s lineup in the late-’90s, and was marketed towards sporty-driving-inclined yuppies who wanted fun BMW driving dynamics (or just a BMW badge), a nicely-equipped interior, and hatchback practicality. Both for the sweet hatch life that we enthusiasts cherish, as well as urban driving and park-ability.

The Strange-Looking E36 BMW 318ti Is Finally Being Appreciated (and Gaining Value)
First year after Uni, working in finance at Deutsche Bank – why not?! – Image: BMW

BMW wanted to go after people who’d otherwise have a nicely-equipped VW GTI in their sights, or even… well… I can’t think of a whole lot else it’d compete with at the time. Mercedes-Benz’s similarly strange-looking C-Class hatchback came a few years later. Regardless, people who were after modest cars that were nicely outfitted, and were willing to spend a little more for premium-brand-level stuff were the target audience. Just look at the catalog for the U.S.-spec version! It was available with a canvas top, how cool and un-Bimmer is that? You can tell BMW was exiting its comfort zone a tad trying to move units to North American yuppies.

I say it was quintessential ’90s German, because just look at it! The back half just screams 90s mainland European aesthetic. It looks like it would’ve been driven by an edgy detective or suave bad guy on the German crime procedural Tatort.

The Mechanicals

As fun and quirky as the 318ti was, unfortunately, the specs don’t exactly match the “Ultimate Driving Machine” energy BMW was otherwise cultivating back then. In North America, it came with BMW’s 1.8-liter, DOHC M42 Inline-4 from ’94-mid-’95, and nearly the same engine, the M44, from mid-’95-’98. I say nearly the same because the only major difference was the M44 made just a couple more pound-feet of torque. Otherwise, it had the same amount of horsepower (laaame). The most power it ever made was 138 horsepower and 133 pound-feet of torque, which under the hood of this little 2,590-pound (at the lightest) hatch enabled it to hit 60 MPH in just under ten seconds.

The Strange-Looking E36 BMW 318ti Is Finally Being Appreciated (and Gaining Value)
Feast your eyes upon this brochure goldmine. Image: BMW Group Archive

Not outstanding, but the real from-the-factory joy seems to lie in its chassis. Like almost all BMWs of the era, it was RWD. It has a very short 106.3-inch wheelbase, so it’s probably good fun to let the rear-end out a bit from time to time if conditions are right… since 138 horsepower ain’t much even in the 3er’s lightest form. Still, it has semi-trailing arm rear suspension, which isn’t ideal, but is still a step above something non-independent. It actually has the same rear suspension as the first-gen Z3, though the regular 3 Series has a much nicer multi-link rear suspension.

Taking a slightly-deeper look at its chassis, the M42/M44 sits pretty far back under the hood, with barely any of it reaching the front shock towers. Not exactly a front-mid-engine placement, but hey, the further back the better for weight balance purposes. It also looks like there’s a lot of room under there; high-mileage services like a new radiator and replacing its serpentine belt would probably be a breeze.

Track Potential is Always a Good Handling Litmus Test

One way I like to figure out a car’s fun-to-drive potential is by seeing what the aftermarket/track scene has done with them. In the case of the 318ti: there’s some precedent for on-track antics! I mean, c’mon, it’s the same chassis as the normal 3er, and we all know how endlessly tracked those are. Here are a couple of fun videos I found to prove the point I’m trying to make.

While slow, it seems like the M42/44-equipped 318ti would make a decent track day and autocross companion, which is nicely demonstrated by this video I found of one at an SCCA event at Portland International Raceway.

BimmerWorld, one of the best retailers of BMW parts in the USA has a soft spot for them in its heart, too. It doesn’t look like there have been many updates on the below project, but it’s off to a great start with good suspension upgrades, and some brilliantly chosen wheel and tire mods.

Abroad, these things are raced in various forms, from spec racing series to rally. The following video features one badass racecar build on the Nurburgring; sequential gearbox, presumably inline-six-swapped, the works!

I think the wing on it helps balance out the rear-end as well, helping it look overall way better.

Oh, and pro-drifter Chelsea DeNofa set one up brilliantly for non-pro-level drifting. It features a cage, BMW S54 swap, and all the steering angle in the world:

I’d say it passes the Fun Potential Track Car Test.

Lots of Potential To Match Its Character

The 318ti has some flavor; it’s got a short wheelbase for increased fun, it’s light, and since it’s a BMW, lots of engine swap potential. Any better engine that’s ever graced an E36’s bay sits right in the 318ti. I’m thinking a sweet setup would be a clean example with an S52 swap out of an E36 M3, decent coilovers, upgraded wheels and brakes, and sticky, track-centric tires. Oh, and the above-mentioned wing and some 90’s German tuner body kit pieces, too.

Even a clean, very OEM example would be fun, and surely still be a solid city car. I mean, cities have only gotten more congested since these were made. It’d get all the attention from ’90s-loving car nerds like yours truly, have good hatchback practicality, and just be something different in these turbulent times of new cars looking more and more alike. Especially European cars.

Though, the 318ti still quite rare — to the tune of less than 25,000 being sold here in the US between 1994 and 1998. It seems like prospective investors (I refuse to call people selling ’90s non-exotics collectors) have caught on to this, too, as pricing isn’t exactly cheap. At least not for a meh-spec engine’d, mid-’90s Bimmer. At the time they were new they were kind of a flop in the USA and stayed a flop for second-hand sellers for many years after. I swear these things were like $2,000-3,000 when I was in high school. Now, people are asking around double-or-more of that, with presumably double the mileage.

Its unique looks are kind of a plus now though, as the cars stand out even in big gatherings of ’90s Euros. When’s the last time you saw a clean one? This might be a good car to add to your perpetually growing list of things to search classified ads for!

Correction (07/12/21): We originally wrote that the M42 was SOHC, but it’s actually DOHC. Apologies for the error!

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