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Used Peugeot 306 review: 1994-2002

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The Peugeot 306 was a revelation when it arrived in 1994 bringing 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 small Peugeot, particularly its ride and handling which were considered outstanding. They were also enamoured with its cute styling, which was a distinct change from the staid Japanese hatches that then dominated the market.


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

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 the optional four-speed auto.

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

Weighing just over 1100 kg the 306 was never going to be a fireball, yet it still returned the reasonable 0-100 km/h time of 12 seconds in manual form. Disappointingly, the auto was about two seconds slower.

Sharp, precise and at the same time impressively supple the 306’s ride and handling was 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 suspension to soak up the bumps instead of bounce over them as some other cars tended to do with their stiffer suspension set-ups.

Even with this ability to soak up bumps the 306 still handled beautifully. Its power-assisted rack-and-pinion steering was nicely weighted and gave the driver plenty of useful feedback.

Equipment level of the XR reflected the price, but it had power windows, central locking, rear wiper and an adjustable steering column. The XT got more in the form of power mirrors, fog lights, an external temp 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 very respectable 115 kW at 6500 revs and 193 Nm at 3500 revs. which gave it plenty of punch and got it to 100 km/h in 9.2 secs while covering the standing 400 metres in around 16.5 secs.

The S16 was fully featured, boasting alloys, ABS and air-con. It was only available with 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 improved performance. The 1.8-litre engine then had 85 kW at 5500 revs and 158 Nm at 4250 revs, which gave it a healthy boost in get up and go.

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 124 kW four cylinder engine and six-speed gearbox, and a vast array of features.


The 306 is generally a robust and reliable little car with the post-1997 model rated slightly better than the earlier models.

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 that haven’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 80,000 km 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, although 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 out quite quickly and they’re relatively expensive to replace.

Later post-1997 cars boast thicker body panels, which make them a little more damage-proof than earlier cars that pick up daily dents much more easily.


Chris Teh bought his 1999 306 GTi6 when it was six months old. It has done 75,000 km now with little trouble and is generally in good overall condition.

The 22-year-old electronics engineer is generally happy with the car, although he says the servicing and parts costs are high. The cost of insurance is also a problem for him.

Chris likes the interior that he says has plenty of room for up to five people he regularly has to accommodate. Even though it’s a little dark inside he likes the ambience and the lack of obvious plastic trim parts.

Performancewise he thinks it lacks the performance of other cars in the same price range, but likes the ride and handling. He is critical of the clutch, which he says is too heavy for a woman to use.

Little has gone wrong with the Peugeot, Chris says. He’s replaced the front disc brake rotors twice and the rears once, and the clutch cable has been replaced.


• cute as a button styling

• roomy well appointed interior

• modest performance from SOHC 1.8

• more zip from DOHC fours

• high brake wear

• excellent road manners

Peugeot 306 1994:

Safety Rating
Engine Type Inline 4, 1.8L
Fuel Type Premium Unleaded Petrol
Fuel Efficiency 10.0L/100km (combined)
Seating 4
Price From $2,860 - $4,400

Range and Specs

Vehicle Specs Price*
Base 2.0L, Premium Unleaded Petrol, 4 SPEED AUTOMATIC $2,970 - $4,620
Base 2.0L, Premium Unleaded Petrol, 5 SPEED MANUAL $2,860 - $4,400
See all 2002 Peugeot 306 in the Range
*Manufacturer's Suggested Retail Price
Graham Smith
Contributing Journalist
With a passion for cars dating back to his childhood and having a qualification in mechanical engineering, Graham couldn’t believe his good fortune when he was offered a job in the Engineering Department at General Motors-Holden’s in the late-1960s when the Kingswood was king and Toyota was an upstart newcomer. It was a dream come true. Over the next 20 years Graham worked in a range of test and development roles within GMH’s Experimental Engineering Department, at the Lang Lang Proving Ground, and the Engine Development Group where he predominantly worked on the six-cylinder and V8 engines. If working for Holden wasn’t exciting enough he also spent two years studying General Motors Institute in America, with work stints with the Chassis Engineering section at Pontiac, and later took up the post of Holden’s liaison engineer at Opel in Germany. But the lure of working in the media saw him become a fulltime motorsport reporter and photographer in the late-1980s following the Grand Prix trail around the world and covering major world motor racing events from bases first in Germany and then London. After returning home to Australia in the late-1980s Graham worked on numerous motoring magazines and newspapers writing about new and used cars, and issues concerning car owners. These days, Graham is CarsGuide's longest standing contributor.
About Author
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