There was a time when it appeared BMW could do no wrong.

In fact for most of the past 25 years, most of its cars have led most of the classes in which they have competed.

But recently it has come under sustained pressure from Audi, Mercedes and Jaguar. And just as they were sharpening up their products, so it seemed several BMWs started to lose their edge. It may just be my perception, but I seem to have been more critical of more BMWs in the past five years than the previous 20. I have even been accused of being ‘‘the most negative journalist in Europe’’ towards the brand, though that was by a BMW employee just after I’d had the temerity to rank a rival car a fraction ahead of one of theirs in a comparison test.

The suggestion is, of course, nonsense. But it is true that when BMW gets it wrong, you do tend to dwell on it more than you might a lesser manufacturer making a similar mistake, because the slip up is more notable, surprising and worthy of attention. It is precisely because such stratospherically high standards are expected of BMW that when it fails to reach them, alarm bells start to ring.

Yet through all its highs and lows, the one constant has been the brilliance of the 3-series. Since its introduction in 1975, not once has it faced a consistent challenge to its class leadership. If BMW’s credibility as the world’s leading manufacturer of aspirational saloons is to survive, it is a lead this new 3-series simply must maintain.

saloons bmw  BMW 320d road test

If it has a problem it is that the previous 3-series scarcely seemed in need of replacement. Designed back in the period when BMW could do no wrong, it made the Audi A4s and Mercedes C-classes against which it was launched look almost inept. Even today, the new generation C-class is the only car you could even start to argue might have its measure. But replaced the 3-series has been, not by an artfully crafted update, but an entirely new car, longer in both length and wheelbase to create more interior room and place some clear air between it and the smaller, strong-selling 1-series.

It looks reasonable – prettier and more distinctive than the old Three, but still not a patch on the effortless style of the latest A4 or the simple handsomeness of the latest C-class. Inside lies further disappointment. The cabin is proficiently executed and ergonomically sound as you might expect from any BMW, but the sense of class and occasion you’ll now find in the Mercedes remains absent. BMW provides you with an effective working environment while Mercedes delivers a home from home. But that is just about the only mistake this 3-series makes, at least in the 320d form I tried.

Its most striking single strength is the envelope of performance it has to offer. When I edited this magazine around the turn of the century I used to go on nostalgia tours to disused racetracks all over Europe in a new 328i, and can remember marvelling that it was capable of 30mpg when driven gently and 150mph when not. A dozen years later, the 320d is scarcely any slower yet if you ease off the gas, it really will do over 60mpg. And that’s not relying on some cooked up official claim, I’ve done it myself over 150 miles of country and motorway roads, driving in a gentle but hardly saintly fashion.

saloons bmw  BMW 320d road test

Meanwhile its performance is quite beyond anything you may expect from a 2-litre diesel, four-cylinder, four-door saloon. It delivers acceleration you’d have been pleased to receive from a 3-litre petrol six not that long ago, aided by an excellent standard six-speed gearbox with ratios matched perfectly to make the most of the engine’s quite narrow powerband.

Still, BMW could have squandered this advantage by making a lesser effort in other areas. It hasn’t. The 320d isn’t merely fast and frugal, it is a genuine delight to drive. In fact it has the most sophisticated chassis ever fitted to a small saloon, and in the era of the outstanding standards now reached by the C-class, that really is saying something. In fact I’d say the Mercedes still has fractionally superior steering, but in every other regard, it is BMW that once more leads the way.

Just as BMW has been able to address the seemingly opposing issues of performance and economy, so it has with handling and ride. Indeed, so capable is the 320d in both these regards, you’re not aware of any compromise being made. In normal driving and across all speed ranges, the 320d ably sponges away the lumps and bumps of everyday life on the road. Meanwhile superior damping means that when sterner challenges are set, it doesn’t lurch, heave or wallow its way over dips and crests, but instead exercises an iron will over its ride height, leaving its occupants blissfully unaware of just how hard it’s working for them.

And this little diesel saloon is properly fun to drive, offering all the balance, precision and poise upon which BMW built its reputation. Unlike many of its more recent offerings the 3-series is actually lighter than the car it replaces despite its extra size, and it feels it too.

saloons bmw  BMW 320d road test

In fact, looks aside, the 3-series is as damnably hard a car to criticise as I’ve driven in a long time. Like all the best BMWs, its strength lies not in individual areas but an ability to compete across the board. And that only comes from an engineering philosophy which does not single out certain disciplines for special effort and attention, but expects the same standards throughout. The result is a car that puts BMW firmly back in control of the most important class in which it competes.

But one important question remains to be answered. Regulars will remember a couple of months ago my disappointment in discovering the new, more powerful but substantially heavier M5, while outstandingly civilised, was substantially less fun to drive than the outgoing car. It spoke to me of misplaced priorities. BMW has now proven with a humble 320d that it can make a new car lighter, quicker, more frugal and fun than the last, so I’d like to hope we’ll be saying the same of the new M3 when it appears in a year or two from now.

saloons bmw  BMW 320d road test

Indeed it is BMW’s M division that seems in need of greater definition. Forty years after it was founded, it is hard to know exactly what the letter means these days other than ‘fast BMW’. Until three years ago, every M car was a rear-drive saloon, coupé or estate, powered by a high-revving, normally aspirated engine. Now just one, the current M3, still subscribes to these founding values. In their place have come four-wheel drive and even diesel SUV M-cars.

To be fair, the need to reduce emissions has probably killed the normally aspirated M-car stone dead, but BMW still has the opportunity to make the new M3 lighter and more fun than the already overweight current car. With a world-class platform such as this to build upon, nothing less should be expected.

Factfile
Engine: 2.0 litres, four cylinders, diesel
Top Speed: 146mph
Price: £28.080
Power: 184bhp at 4000rpm
Fuel/co2: 61.4mpg, 120g/km
www.bmw.co.uk