Keepers: BMW M3 E46—Shopping

The current state of the auto market makes for some tantalizing possibilities when it comes to performance cars, and with good-condition E46 prices dipping well into the $20,000 range, it’s currently one of the best performance purchases available. Unfortunately, perhaps the biggest stumbling block on the road to M3 ownership has nothing to do with the car itself, but rather the cost to insure it. Running a quick check for a squeaky-clean, 22-year old driver returns a frightening range of $300 to $700 per month for full coverage, thanks to a perfect storm of popularity (as in popular among thieves) and performance. Yes, the early-20s insurance bracket is one of the highest in the nation, and that figure doesn’t include anything like multi-car discounts or occasional-use driving. Regardless, this is one expensive car to cover, so before getting your hopes up, better call your insurance guy to see if it’s even feasible.

Otherwise, the E46 is a fairly reliable car as far as performance vehicles are concerned. BMW did receive some bad press early on for engine-related troubles, specifically problems with oil pumps and rod bearings that led to numerous engine failures. BMW ultimately issued a service action to address concerns, stopping short of a full-blown recall but still offering to repair or replace the damaged or defective equipment while extending the engine warranty to 6 years or 100,000 miles. Other occasional issues include trouble with the advanced Sequential Manual Gearbox (SMG) transmission, excessive clunking in the suspension, failing coil packs, and window trim that doesn’t seem to enjoy staying around the windows.

The engine issue affected 2003 and earlier cars, which may be a contributing factor to their lower overall price. The entire E46 M3 lineup remained relatively unchanged through its life cycle however, though a special “Competition Package” was available in 2005, featuring a number of performance-inspired upgrades from the limited-run (and overseas-only) M3 CSL. The resulting suspension tweaks became standard equipment on all subsequent M3s, but the bigger brakes, tighter steering ratio, revised “Track Mode” setting for the stability control system, unique wheels, and specialized trim were all unique to the Competition Package, making it one of the more desirable M3s to own.