BMW 320d vs rivals

Sales of compact executive saloons have been going from strength to strength, but unless you’re one of the big three of Audi, BMW and Mercedes, you need to do something different to stand out from the crowd. That’s why the all-new Lexus IS ditches diesel in favour of Toyota’s petrol-electric hybrid power. This third-generation car aims to tempt buyers with its comfort, kit and company car-friendly emissions. We’ve assembled a really tough welcoming committee for the new IS 300h SE – kicking off with BMW’s 320d EfficientDynamics. This saloon combines low running costs, comfort and engaging dynamics, while the Business edition tested here comes with a respectable amount of equipment. The Audi A4 2.0 TDI isn’t quite as efficient as its rivals, but in SE Technik trim it’s not only cheaper than the Lexus, it also has plenty of kit and first-class cabin quality. So is the new IS good enough to loosen the German stranglehold over the compact executive class?

•BMW 3 Series review

•Audi A4 review

•Lexus IS 300h review 

 1st place - BMW 320d

The BMW 3 Series retains its crown as the UK’s best compact executive saloon – and this EfficientDynamics model is ourpick of the range. Its combination of low running costs, a spacious interior and engaging handling is difficult to beat. The only black mark is the noise of the diesel. It's dominated the compact executive sector since it was first introduced back in 1975, and the sixth-generation model is a consistent presence in the UK sales charts top 10. It’s bigger, better built and more refined than ever, plus it’s packed with kit and has a wide range of engines. The EfficientDynamics model manages to combine low running costs with an entertaining driving experience, and Business spec adds even more kit to the mix.

Used - available now

2025 SEAT

Ateca

19,591 milesAutomaticPetrol1.5L

Cash £20,086

View Ateca

2022 Toyota

C-HR

30,493 milesAutomaticPetrol2.0L

Cash £20,790

View C-HR

2019 Citroen

C3 Aircross

49,228 milesManualPetrol1.2L

Cash £8,999

View C3 Aircross

2023 Audi

TT

61,207 milesAutomaticPetrol2.0L

Cash £16,499

View TT

2nd place - Audi A4

Yet again, the Audi A4 is edged out by its arch rival. While our SE Technik model is competitively priced, has a decent amount of standard kit and is well built, it can’t match the 320d’s combination of sharp handling and comfort. The 2.0-litre diesel is more refined than the BMW’s, but it’s dirty. The Audi A4 was the old stager in this test, and it was seemingly obvious. 

3rd place - Lexus IS 300h

The Lexus IS manages to run its German rivals closer than ever thanks to its comfortable cruising ability, and the low running costs make this hybrid version attractive for company buyers. It’s a good effort, but the remote driving experience and lifeless steering count against it, and the base SE model needs more kit. Having said that, the third-generation Lexus IS is all-new from the ground up. While the previous model was offered with a diesel during its life, the new range consists solely of petrol power. There’s a conventional 2.5-litre V6 in the IS 250, while our hybrid IS 300h test car hooks up a 2.5-litre four-cylinder to an electric motor. Both engines come with automatic transmissions – there’s no manual option – while all models are generously equipped.

Driving

While the 320d ED is tuned for efficiency, it can still put a smile on your face. The engine is responsive and there’s plenty of grip, but push the narrow tyres to their limit and you can play with the car’s balance in corners, thanks to the communicative steering and sharp chassis. It’s even better in Sport mode. In contrast, the Lexus feels heavy and slow-witted – even the front-wheel-drive Audi is better balanced through bends.

Infotainment control

The Lexus uses a joystick controller and the on-screen cursor ‘snaps’ to the nearest button, but if you do this while on the move, bumps in the road can leave you selecting the wrong sub-menu. The scroll wheel and button systems used in the BMW (inset) and Audi are much more straightforward to get on with.

Company car costs

These cars are designed for business users, and BMW and Audi have tailored versions for company buyers, in the shape of the Business and SE Technik models. However, the Lexus leads the way for tax costs, thanks to its 11 per cent banding. This means top-rate taxpayers will pay £1,295 a year, which is over £600 cheaper than the BMW (£1,904) and nearly £1,000 less than the A4 (£2,192).