What many still see as the ultimate M3 remains comparatively affordable – here's what to look for
By PH Staff / Thursday, April 1, 2021 / Loading comments
- Timeless look
- Proper rev-hungry S54 straight-six
- Compact footprint and keen handling
- An appreciating M division model
- But beware a cracked boot floor…
Search for used E46 M3 here
If ever a car defined all that is right about the engineering talents of BMW’s M Division, it’s the M3. The E46 was the third generation of the compact, high performance model and it struck gold with its balance of power, performance and usability. And, of course, those looks, born of a time when the M3 wasn’t required to adopt a more practical four-door form.
Introduced in October 2000, the E46 arrived with an improved and uprated version of the 3.2-litre straight-six engine. It developed 343hp, giving it one of the highest specific outputs of any naturally-aspirated engines in the world at its launch. North American-bound M3s were saddled with a detuned engine producing 333hp, but we’ll concentrate on Euro-spec models in this guide.
A six-speed manual gearbox was the only option for the E46 M3, although BMW did offer it with an SMG (sequential manual gearbox) to do away with the clutch pedal, if not the clutch. BMW also introduced a Convertible version of the M3 in February 2001.
The ultimate M3 arrived in May 2003 with the CSL (Coupe Sport Leichtbau). It shed 110kg over the standard Coupe by ditching luxuries such as electrically adjusted leather seats, air conditioning, satellite navigation and the stereo system. As its name suggests, the CSL was a more hardcore machine with unique 19-inch Y-spoke alloy wheels fitted with Michelin Pilot Sport Cup tyres that made the car a handful in the wet. Because of this, BMW asked CSL buyers to sign a disclaimer saying they understood the nature of the tyres.
With an extra 17hp, plus a carbon fibre roof, front spoiler and rear diffuser, the CSL went from 0-62mph in a claimed 4.5 seconds compared to the standard M3 Coupe’s 5.1 seconds – although many considered those figures to be conservative. Both the manual and SMG transmissions delivered the same acceleration figures, while top speed was pegged to 155mph, although like the launch times, real world tests suggested 160mph was more accurate.
A last hurrah M3 CS in 2005 took the wheels, brakes, steering wheel, quicker steering rack and uprated traction control of the CSL and married them to an otherwise standard M3 Coupe. The big difference with the CS was it could be bought with the standard six-speed manual gearbox rather than the SMG ‘box that was the only choice in the CSL.
Production of the E46 M3 came to a halt in August 2006 when the last of the Convertibles rolled down the Regensburg line. The very best M3s now command well over £30,000, while higher mileage cars can be had for £13k. Convertibles are often the cheapest, starting at around £10k, meaning the M3 is just as much of a bargain now as was when new.
SPECIFICATION | BMW M3 (E46)
Engine: 3,246cc, inline six
Transmission: 6-speed manual (or SMG II sequential), rear-wheel drive
Power (hp): [email protected],900rpm
Torque (lb ft): [email protected],900rpm
0-62mph: 5.2 secs
Top speed: 155mph
MPG: 23.7 (official combined)
Wheels: 18in (f), 18in (r)
Tyres: 225/45 (f), 255/40 (r)
On sale: 2000 – 2006
Price new: from £41,150 (2004)
Price now: from £11,000
Note for reference: car weight and power data are hard to pin down with absolute certainty. For consistency, we use the same source for all our guides. We hope the data we use is right more often than it’s wrong. Our advice is to treat it as relative rather than definitive.
ENGINE & GEARBOX
The 3,246cc S54 six-cylinder engine, now the stuff of legend, uses a cast iron block with 87x91mm bore and stroke. Compared the previous E36 M3, the E46 model gained new camshafts and an increased compression ratio, rising to 11.5:1 from 11.3:1. A new Siemens-developed engine management control system was also added, along with a fly-by-wire throttle and two-mode M Dynamic Driving Control that offer Normal and Sport modes to alter throttle response.
Additionally, BMW introduced new finger-type rocker arms to reduce friction in the engine, as well as lowering reciprocating mass. The result is a peak power delivery at a hair raising 7,900rpm, just 100 revs before the redline. A one-piece aluminium cylinder head contains the 24 valves, while a new scavenging oil pump ensures they remained lubricated when the lateral forces are high.
The result of all this work is 343hp in a normally aspirated engine, making the most powerful motor per litre BMW had produced at the time, other than the McLaren F1’s 6.1-litre V12 motor. Coupled to this is a six-speed Getrag manual gearbox that could be bought in either standard form with a clutch pedal or SMG (sequential manual gearbox), which swapped the clutch pedal for paddle shifters and a gear lever that can be nudged forwards and back to change gear. In the SMG II ‘box, the clutch is actuated by BMW’s electrohydraulic Drivelogic system that offers 11 different modes, and a Launch Control.
Both transmissions have identical ratios and the same internal components, and both send power to the back wheels through an M Variable Differential Lock limited-slip differential. To further help the M3 control its power, BMW fitted Dynamic Stability Control as standard.
Somewhat controversially, the M3 CSL only came with the SMG gearbox, which is the same as the standard M3’s. However, the DSC was modified to offer an M Track Mode that allows the rear of the car to oversteer more before intervening. To increase the CSL’s power by 17hp to 360hp, BMW added a carbon fibre intake that sucks in more air and gives the E46 its most intense noise. The VANOS variable valve timing was altered and a lightweight exhaust manifold with thinner, straighter tubing was also added.
Most CSLs have led a pampered life in the hands of dedicated enthusiasts, not least because its higher focus makes living with one a greater commitment to the cause. However, all of the same checks for the M3 Coupe apply to the CSL, so a prospective buyer’s first port of call should be the service record to make sure the original running-in service was carried out at 1,200 miles. This included an oil change that has proved essential to the M3’s long-term health.
The SMG’s hydraulic fluid pump can fail, leading to the gearbox dropping into neutral. Replacing the pump is costly, but this can also be misdiagnosed when the relay is failing, and a new relay is easy and cheap to replace. Clutches wear more quickly in SMG-equipped M3s, particularly those that spend more time in town. Judder from the clutch as drive is taken up in the lower gears is a clear sign it will need replacing. However, BMW also offers a software update that should have been added to any SMG M3 to reduce clutch judder.
As for the engine itself, it’s a famously tough unit. Some early cars suffered crank bearing failures, but all of these affected cars should have been repaired under warranty or had the engine replaced by BMW. The fault seemed to rear its head at around 30,000 miles, so any very low mileage early M3 should have its history file carefully inspected.
The double VANOS variable valve timing is more robust on the E46 M3 than it was on the E36 version. However, the VANOS bolts can loosen at around 70,000 miles. If they break, it can ruin the engine, but stronger replacement bolts are available from BMW.
A noisy rear differential is nothing to worry about if it makes a little grumble when turning tightly at low speeds. A change with the correct Castrol oil will help, but this is a common characteristic of the M3. Alternators and coil packs have been known to fail, but both are straightforward to fix, and a competent home mechanic can tackle either problem to keep costs modest.
The M3 uses a steel monocoque shell with MacPherson strut front suspension and a multi-link set up at the rear. For the M3, BMW widened the front and rear tracks compared to the standard 3 Series Coupe and fitted unique ‘bat wing’ forged aluminium lower control arms with bearings and bushes developed specifically for the M model.
For the M3 Convertible, a stronger rear subframe was added to carry the larger half-shafts and uprights to cope with the extra power. BMW also used thicker anti-roll bars, with a 26mm item at the front and 21.5mm at the rear. In February 2002, the Coupe and Convertible gained an M Racing strut brace for the front suspension.
A set of 18-inch alloy wheels were standard for the M3, with the option of 19-inch alloys. Michelin Pilot Sport tyres were original fitment in 225/45 ZR18 front and 255/40 ZR18 rear, with the 19-inch wheels using 225/40 ZR19 and 255/35 ZR19 tyres front and rear respectively. The CSL has unique 19-inch alloy wheels with Michelin Pilot Sport Cup tyres in 235/35 ZR19 front and 265/30 ZR19 rear sizes.
Behind the wheels reside 325mm ventilated discs front and rear with ABS as standard. The power assisted rack and pinion steering of the standard M3 needs 3.2 turns from lock to lock, while the CSL quickened this with a 14.5:1 ratio rack for 3.0 turns between the stops.
The CSL also benefits from firmer suspension with front springs that are shorter by one coil and different rate shock absorbers. Thicker front and rear anti-roll bars, 30.8mm and 22.5mm respectively, are supplemented by aluminium rear suspension links and firmer bushes all round. Larger 345mm front brake discs are used for the CSL. Upgrading the brakes for track use is worthwhile and Pagid Yellow compound pads are a good first step. AP Racing’s 335mm front discs with six-pot calipers are the next logical step for greater stopping power.
As with all E46 3 Series, the M3’s front ball joints wear and spoil the feel of the car, but they are a straightforward repair. The front wishbone bushes and rear trailing arm bushes are also likely to need replacing on any car with 60,000 miles or more on the clock. Rear coil springs and dampers will most likely need replacing by 80,000 miles. Aftermarket suspension kits are widely available for the M3, but cheap ones can ruin the ride and handling balance. Eibach or H&R springs are worthwhile, while AC Schnitzer kit is better still but expensive.
Last point to look for is a cracked boot floor. BMW replaced them under warranty when the problem occurred on cars that were less than 10 years old, so plenty won’t be as old as the rest of the M3. But on cars that do suffer the issue (it’s considered an inevitability), they will be very expensive to fix. Pricing will obviously depend on the body shop.
You won’t need us to tell you that the M3 is subtly different to the standard 3 Series Coupe. Those flared wheel arches, covering wider front and rear tracks, are unmissable. Same goes for the chromed side vents, the power-bulge-bearing aluminium bonnet and wider front ‘kidney’ grilles. The front bumper is also more prominent in design, with a larger splitter, matched at the back by a rear bumper bearing a small (by modern standards) diffuser and tidy quad tailpipes. Of course, the M3 also gets unique door mirrors.
The CSL took the design enhancements a stage further with a roof, front splitter and rear diffuser made of carbon fibre. Its front bumper is a different shape to incorporate a single air intake on the left-hand side, while the composite material boot is shaped to include a rear spoiler. With a diet that included thinner rear glass, the CSL saved 110kg over the standard SMG M3. A small price to pay for the CSL’s added focus is a reduction in its urban usability, largely thanks to the lower ride height. With the front bumper closer to speed bumps, cracks and scuffs are common.
In September 2001, BMW upgraded the xenon headlights to bi-xenon lights. The self-levelling can fail for these lights, though this is usually down to a simple relay rather than the entire light unit needing replacing. For April 2003, LED rear lights became standard across the M3 range.
M3s are more resistant to rust than standard 3 Series models, due largely to the front wheel arches not having a rubber seal on the arch liner that attracts mud and damp. However, the rear arches have been known to corrode where they meet the back bumper, so inspect carefully. While doing this, also look around the rear window edges for any signs of corrosion.
Door locks need a slug of spray grease every six months to avoid sticking. It’s also important for the Convertible’s folding roof linkages to get a regular dab of grease at every service to keep it working smoothly. The fabric hood is very well made and should work quickly and fit snugly. Any drop-top roof that doesn’t work and fit properly suggests badly repaired accident damage.
The M Design seats of the standard M3 are trimmed in Nappa leather that needs regular cleaning and leather food to keep in tip-top conditioning. Cracked leather is not uncommon, while the driver’s side right-hand bolster also becomes crushed over time. The steering wheel is unique to the M3, as are the instrument binnacle’s grey-faced dials that include a rev counter with orange segments that go out as the engine warms through to indicate the safe rev limit. The speedo reads up to 180mph.
A lot of M3s will have a television and satellite navigation fitted. The sat-nav will need an up to date CD to give accurate information, while the television will probably be redundant with today’s digital signals. While looking at the centre console, make sure the air conditioning works properly. You should also press every button to be certain all of the electrics function properly, including the illuminated M gear knob for the manual gearbox.
The CSL’s cabin varies quite a lot from the standard M3s as it ditches the electrically adjusted front seats in favour of deeper bucket-style sports seats trimmed in Anthracite Reflex cloth and Amaretta synthetic suede. These seats do without the side airbags of standard M3 models. In the back, two individual seats are trimmed in the same cloth as the front pews, while the steering wheel is finished in Alcantara and has the button for the M Track mode where you’d normally expect the stereo controls.
Going further, the CSL also has lightweight door trims and a centre console made of lightweight composite material. BMW did away with satellite navigation, any stereo or CD, air conditioning, sunroof or electric seat adjustment for the CSL to save weight. Buyers could order air conditioning as an option.
On all M3s, the interior door handles have been known to come loose and fall apart, although this likely would have been sorted under warranty. The rear-view mirror’s light reactive fluid can leak inside the mirror which will be obvious at a glance. It’s expensive to replace from BMW, so worth checking. Also, make sure the door seals fit and sit snugly to keep out wind and noise.
To many, the E46 generation delivered the ultimate expression of the BMW M3. With a sublime six-cylinder engine, relatively compact footprint and timeless looks, it offered plenty to the enthusiast driver without being overly brash. In fact, against the new G80, the E46 looks decidedly subtle, which has only aided its long-standing appeal. The turn of the century produced some truly wonderful driver’s cars, and the M3 stands tall with any of them.
Despite responding well to modifications – you only need look at any track day paddock for proof of that – the most sought after E46 M3s today are standard cars. Not simply because it was such a well executed package from the factory, but because this era of M3 is one of the most obvious modern classics out there – and values now reflect that. Once upon a time scabby ones dipped incredibly close to £5k, and there was only one way the E46 was going from there.
Given the market’s newfound inclination for anything even half good, the M3’s newfound favour is well deserved. Few cars combine a great engine and chassis so cohesively and the E46’s styling is never, ever going out of fashion. Moreover, if something like an E30 M3 can feel a bit gutless on the road and a later, turbocharged M3 rather OTT, then the E46 could be said to have struck a real sweet spot between modernity and old school feel – which is probably why everyone is now clamouring after it.
Now those scabby cars are more than £10k, and to be honest it’s more likely that it’s a less desirable Convertible around that money. For a presentable coupe you’re looking nearer £15k now, and cars with less than 100,000 miles nearer £20,000. Some selling the very lowest mileage M3s are asking nearer £40k – a price simply unheard of just a few years ago.
Even if today’s E46 M3 buyer doesn’t enjoy the same sort of appreciation this decade, they will still get to experience one of the finest M cars ever for hot hatch money. Availability is good, with 37 cars on PH alone at the time of writing; with these cars now recognised as legends and the cheap ones discarded, expect numbers to stay steady as owners strive to save M3s. Indeed, it makes you wonder why on earth anyone would sell. But if they do, seize the opportunity – this is a BMW great for good reason.
Search for used E46 M3 here
[This is a comprehensively updated version of an article that was first published in 2012]
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