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Used Peugeot 306 review: 1994-1997

The Peugeot 306 was a revelation when it arrived in 1994.

Suave and sure-footed, the Peugeot 306 was a small-car wonder.  The Peugeot 306 was a revelation when it arrived in 1994.  It was an intoxicating European blend of prestige and practicality that had been missing from most of the familiar small cars at the time.

Contemporary road testers were universal in their praise of the Pug, particularly its ride and handling, which were considered outstanding. They also liked its cute styling – a distinct change from the staid Japanese hatches that then dominated the market.

Model watch

THE 306 N3 range included the budget XR three-door hatch, the nicely equipped XT five-door hatch and the sizzling S16 sports hatch.  A few months later a cabriolet joined the party, and in 1995 a four-door sedan was added.

The XR and XT were mechanically identical, using the same all-alloy 1.8-litre, single overhead cam, fuel-injected, four-cylinder engine driving the front wheels through either the standard five-speed manual gearbox or an optional four-speed auto.

Peak power was a modest 77kW at 6000 revs, torque peak was 160Nm at 3000 revs. Biased towards low-end and mid-range drivability, the 306 was no top-end screamer, but it did deliver smooth, unfussed motoring.

At little more than 1100kg the 306 was never going to be a fireball, yet the manual still returned the reasonable 0-100km/h in 12 seconds. The auto was about two seconds slower, which was disappointing.

Sharp, precise and at the same time impressively supple, the 306's ride and handling were a delight, delivered by a combination of MacPherson strut front suspension and trailing arm/torsion bar independent rear.

Part of the 306's secret was its long suspension travel, which allowed the car to soak up the bumps instead of bounce over them, as some other hatches tended to do with their stiffer suspension set-ups.

Even with this forgiving suspension, the 306 still handled beautifully. Its power-assisted rack-and-pinion steering was nicely weighted and gave the driver plenty of useful feedback.

The equipment level of the XR reflected the price, but it had power windows, central locking, rear wiper and adjustable steering column. The XT got more in the form of power mirrors, fog lights, external temperature gauge and boot carpet.

ABS was optional on the XT but not available on the XR, and neither had airbags to begin with.  The sporty S16 three-door hatch was powered by the 2.0-litre twin-cam, four-valve engine from the larger 405 and was an altogether different car.

Output was a respectable 115kW at 6500 revs and 193Nm at 3500 revs, which gave it plenty of punch and got it to 100km/h in 9.2 secs while covering the standing 400m in about 16.5 secs.  The S16 was fully featured, including alloys, ABS and aircon. It was available with only a manual trans, and there was a sunroof available.

The heavily revised N5 series arrived in July 1997 and this brought new twin-cam engines and much better performance.  The 1.8-litre engine then had 85kW at 5500rpm and 158Nm at 4250rpm, which gave it a healthy boost.

The entry-level model became the Style, the mid-spec XT remained, the S16 became the XSi, and the sizzling new GTi6 was the range-topper.  The GTi6 had a zippy 124kW four-cylinder engine and six-speed gearbox, and a vast array of features.

In the shop

The 306 is generally a robust and reliable little car, the post-1997 model rating slightly better than the earlier ones.  Some 1.8-litre engines in early cars suffered from an audible piston rattle and high oil consumption, and while most were fixed under warranty there are some still in service in which this hasn't been rectified.

Listen carefully for a rattly engine. Later twin-cam engines have few reported problems, and the 1.8-litre has more respectable performance than the earlier single overhead cam unit.

It's important to change the cam belt at the recommended 80,000km or four-year intervals on both the SOHC and DOHC engines. A broken belt is likely to result in serious internal damage to the engine.

No problems are reported with the transmissions or drivelines, though the manual gearbox is much preferred to the auto, which turns the 306 into a slug.  Brake wear is an issue with all 306s. The front disc rotors wear quite quickly and are quite expensive to replace.  The later post-1997 cars have thicker body panels, which makes them a little more damage-proof.

Look for

DOHC fours, which have more zip

Worn disc brakes


Year Price From Price To
1997 $1,900 $5,170
1996 $1,900 $4,950
1995 $1,900 $4,510
1994 $1,900 $4,400

View all Peugeot 306 pricing and specifications

Pricing guides

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Range and Specs

(base) 1.8L, PULP, 5 SP MAN $2,400 – 4,180 1994 Peugeot 306 1994 (base) Pricing and Specs
S16 2.0L, PULP, 5 SP MAN $2,400 – 4,070 1994 Peugeot 306 1994 S16 Pricing and Specs
XR 1.8L, PULP, 5 SP MAN $1,900 – 3,300 1994 Peugeot 306 1994 XR Pricing and Specs
XT 1.8L, PULP, 4 SP AUTO $2,200 – 3,850 1994 Peugeot 306 1994 XT Pricing and Specs
Graham Smith
Contributing Journalist


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