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The excellent BMW X5's little sister, the X3, arrived last year to satisfy buyers who didn't want a "big" SUV.

Unfortunately, the X3 is only 100mm shorter than the X5 and only marginally smaller in other dimensions. It even shares an engine with the X5.

Indeed, there is a relatively small price difference – about $8000 or close to 10 per cent – to further close the gap and even the cars' physical appearances are similar. The X3 gains friends because in the dirt, at least, it's quite a capable machine.

Part of that off-road competency is BMW's excellent all-wheel- drive system that allocates power to the wheel/s with the most traction. Combined with a decent ground clearance, fat tyres and an all-up mass that is about 200kg lighter than an equivalent X5, the X3 is quite a surprise.

Even without a low-range transfer case, it took to some sandtracks with ease. Let down the tyres and it'll go even farther, though I'd suggest travelling with a mate in a Land Cruiser or Patrol when the sand goes to powder.

Through the sand trails north of Perth, the X3 3.0i – designating the three-litre 170kW petrol six – had heaps of torque and excellent throttle response.

It's helped by a five-speed auto box with sequential shifting, and though that manual-shift option is nice, the wagon ran better in the dirt in full-auto mode.

The suspension was long-legged and compliant, so comfort also rated as tops.

Back on the bitumen a few niggles became a big headache.

The X3's booming exhaust makes it a noisy vehicle to drive, and even worse for the driver is the complaints from passengers.

It is so out of character I scrambled around underneath trying to find exhaust pipe holes, though other critics have agreed it's a noisy machine.

That aside, the engine is a sparkler and really makes the wagon get up and fly. The small steering wheel, virtually all-black interior and solid handling traits make it feel more like a sports car than a baby SUV.

Buyers seeking flexibility have flip-and-fold rear seats for a long, though narrow, cargo ability.

Though the test car came with many features, most are options that come at a high price.

The base model, which sells at $71,400, doesn't have a lot of goodies, though airconditioning, electric windows and mirrors, CD player and dual airbags are standard.

The test car had another $20,000 of options – including satnav/tv at $6990, wiring for Bluetooth ($700), metallic paint ($1700), headlight washer ($700) and a superb electric sunroof ($3300) that almost stretched the length of the roof.

There's not even a full-size spare tyre! So, this is not an inexpensive SUV and, without on-road costs, you're looking at about $91,500.

But though it's a great driving car – noise aside – it's not as good as the X5. I guess that's what sister rivalry is all about.

BMW X3 2005: 3.0I

Engine Type Inline 6, 3.0L
Fuel Type Premium Unleaded Petrol
Fuel Efficiency 17.4L/100km (combined)
Seating 5
Price From $5,610 - $7,920
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