BMW's smallest SUV is one of its most important offerings, and with a new third-generation model now here, the X1 is finally hitting its stride.

For BMW, the 2023 X1 is one of the most important models in the brand’s arsenal. The third best-selling model in its class and the fourth best-selling BMW model overall in what is a truly vast lineup, the X1 has finally received a thorough update that the outgoing model sorely needed. Still based on the UKL2 platform and carrying over the same base engine options, this third-generation update is all about advancements in style and technology rather than outright performance.

At launch, two petrol-powered variants are on offer, both of which we have on test here – the sDrive18i, pictured in Utah Orange, which is priced from $60,400 and the xDrive20i, shown here in Sanremo Green, which starts at $70,400 before on-road costs. The electric iX1 xDrive30 has also recently joined the range, while the high-performance M35i xDrive is due in late 2023.

While this new X1 wears an all-new look, it’s one that’s far less controversial than some other recent BMW designs. There’s no drastically oversized grille or overstyled elements here – simply, the new X1 looks bold, chiseled, and smart, while it’s bold colour pallet only makes it look even more hip. Forget sensible silver or resale grey – unique colours are back in fashion.

Both models tested here rode on the distinctively modern ‘style 867’ 19-inch alloy wheels which I think suit the look well. They’re standard fitment on the xDrive20i, while they’re optional on the sDrive18i. Factor in the fitment of the ‘Enhancement’ package which we’ll touch on in a moment, and it took the sDrive18i’s price tag up to $66,913; the xDrive20i also had the same package fitted along with upgraded leather upholstery to take its tested price to $77,200.

Those numbers might look a bit steep to some, but when you consider how much equipment the X1 features even as standard, it justifies those numbers quite substantially. Both variants offer adaptive cruise control, dual-zone climate control, a head-up display, the new ‘Live Cockpit Professional’ dashboard with a 10.25-inch instrument cluster and 10.7-inch infotainment screen on a curved display panel, sports seats and steering wheel, adaptive LED headlights with high-beam assist, and satin chrome exterior trim.

Both also feature the Driving Assistant Plus safety suite (including blind-spot monitoring, rear cross-traffic alert, lane departure warning, front collision warning with brake intervention, and rear collision prevention) and Parking Assistant Plus system (including Parking Assistant with Active Park Distance Control, Reversing Assistant, an in-built Drive Recorder, and a 360-degree camera system with surround, panorama, and 3D views) as standard, meaning there’s very little that isn’t offered as standard.

What is left on the table is added back in through the ‘Enhancement’ packages which includes metallic paint, a panoramic sunroof, adjustable rear seats, more interior upholstery options, and an excellent Harman/Kardon audio system with illuminated logos which look fantastic at night. It also adds power-adjustable front seats and Driving Assistant Professional with semi-autonomous driving capability on the sDrive18i, while they along with front seat heating are standard on the xDrive20i.

It’s worth noting, however, that while heated seats may be standard on the xDrive20i, sDrive18i buyers will have to pay extra to get it on a subscription, costing $29 for a month, $289 for a year, $419 for three years, or $589 to have it for life. Likewise, steering wheel heating is also a subscription for either model, costing $19 for a month, $169 for a year, $259 for three years, or $349 for the vehicle’s lifetime. Considering the nature of these subscription features, it means that the necessary equipment is already inside the seats and steering wheel, meaning it feels a bit wrong to be stung extra for something that’s already there.

As you’d expect from a BMW, the materials all feel top-quality, with leather finishes on the dashboard and front door cards along with the seats and armrests. In the sDrive18i, it’s only Sensatec rather than real leather, but it still feels as premium as you’d expect. Do note, though, that the rear door cards do see some cheaper materials used, while the interior trim feels a bit plasticky and hollow in some places such as under the infotainment display – even in the xDrive20i which had open-pore Eucalyptus trim featured throughout.

There’s no denying that the interior design is a bit unconventional in some ways, such as with the odd air vent distribution across the dashboard, the floating centre console, or the new curved display, but the key to it is that it all looks attractive and feels functional – that is, apart from the centre console which opens the wrong way for the driver to access it, likely a hangover from its left-hand drive European target market.

The new infotainment system in particular is a highlight, with the 2023 X1 using the latest iDrive 8 system. Although it takes a little while to get used to at first and appears to prioritise funky artwork and aesthetics over practicality upon first glance, once you dive into it it’s a crisp system that’s easy enough to figure out. Among new features, I love the augmented reality sat nav display which adds guidelines to show exactly where to turn at intersections.

The range of new drive modes are also quite fun, with them affecting cabin ambience as much as the actual characteristics of the vehicle’s driveline. They include Personal, Sport, Efficient, Expressive, Relax, and Digital Art, with all using a range of bespoke artworks and interior lighting configurations.

Aside from the wrong-way-round centre console cubby which is tiny inside, interior storage space is good with sizeable door pockets and a big tray underneath that floating centre armrest. Boot space has also grown for this third-gen model, with it offering 540 litres with the rear seats up or 1600 litres with them folded down.

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The interior similarities of these two variants carries over to their on-road performance despite each having rather different powertrains. In the base sDrive18i, you’ll find a 1.5-litre turbocharged three-cylinder engine making 115kW and 230Nm, paired to a seven-speed dual-clutch automatic transmission and front-wheel drive, making it good for the 0-100km/h sprint in 9.0 seconds. Step up to the xDrive20i and there’s a 2.0-litre turbo four-pot with a meatier 150kW and 300Nm, with it backed by the same DCT but instead connected to an all-wheel drive system, helping cut the triple-digit dash to 7.4 seconds.

Regardless of which engine you opt for, the power delivery in both feels smooth and linear, with both feeling strong through the mid-range in particular. Truth be told, this similarity is actually no surprise as the two engines use the same modular design, so the larger four-pot really does just have an extra cylinder tacked on to it. The three-cylinder is certainly the better sounding of the two to my ear, offering that distinctive angry buzz although it’s a tad muted to keep the cabin ambience pleasant, but you can truly feel that the four-cylinder utilises the extra 25 percent edge it has.

Both using the same transmission also adds to the effect. Despite DCTs falling out of favour across the industry in recent years in favour of torque converter automatics – even BMW’s M division has sworn off using them in future – this seven-speed fitted to the X1 is a fine example of how well they can fit in vehicles geared for economy. Although there’s no way to manually shift it thanks to a lack of paddles, it feels intuitive in any of its drive modes, its gearing is evenly spaced, and it offers a more connected feel.

As you’d expect from a BMW, the 2023 X1 is capable of holding its own fairly well on a winding road, with acceptable body control and steering that’s responsive enough, although it’s not quite what you’d call the ultimate driving machine in the traditional sense. It’s here that the all-paw xDrive20i model has its greatest advantage as it feels more tractable and confident where the sDrive18i can feel less planted and engaging. M Sport suspension and steering is optionally available, however, which I can only imagine would help it feel a bit more BMW-ish in the classical sense.

In traffic, the base model comes into its own, though, with its more modest outputs meaning it feels entirely suited to the flow of traffic while still being potent enough for higher speeds on freeways and arterial roads. The 2.0-litre, of course, is plenty punchy at all times, offering more of a feeling of eagerness where the 1.5-litre simply comes across as compliant. Ride quality feels identical in both, with it tending more toward the side of comfort than dynamics. Mind you, both tested here had 19-inch wheels, and while stylish 20-inch rims are on offer, I’d steer clear of them.

City-dwellers will be drawn to the sDrive18i’s fuel efficiency advantage, though. I saw consumption of just 6.9L/100km during my 353km of testing, which is very close to its 6.5L/100km claim. However, fuel consumption is still very impressive in the xDrive20i which used 7.5L/100km across my 454km of driving, again coming close to the claimed mileage of 7.2L/100km.

As with all BMW models, the 2023 X1 is covered by a five-year unlimited kilometre warranty. BMW offers a five-year/80,000km pre-paid Service Inclusive Basic package for the very fair price of $2150 for all X1 variants, with servicing intervals determined by the vehicle’s Condition Based Servicing system.

It’s clear that this new X1 looks and feels more mature than before, and that’s something it needed to be. With the outgoing model feeling dated and underdone in areas, this third-gen model has addressed all of those shortfalls and turned the X1 into one of the smartest buys in BMW’s lineup.

In particular, it’s the base model that stands out for its value for money. Yes, you’re losing a quarter of the engine, but you’re saving ten grand and some more fuel in the process. The xDrive20i is definitely the better car of this pair, although those after performance may wish to wait and see what the M35i will retail for as the 20i doesn’t feel especially engaging – at least not without the M Sport package.

Regardless, BMW has given a model that sorely needed some love a lot of it. It might be using a few leftover parts when it comes to the platform and drivetrains – albeit with some updates and changes – but it’s making the absolute most of them.

2023 BMW X1 sDrive18i: $60,400 | xDrive20i: $70,400
  • 7.5/10
    Performance - 7.5/10
  • 7.5/10
    Ride & Handling - 7.5/10
  • 8.5/10
    Tech & Features - 8.5/10
  • 8.5/10
    Practicality - 8.5/10
  • 8/10
    Value for Money - 8/10

Pros: Stylish inside and out, impressive new infotainment system, solid blend of performance and efficiency, base model is good value for money for the segment
Cons: Seat and steering wheel heating subscriptions feel wrong, doesn’t feel as engaging as you’d expect for a BMW, some plasticky trim

2023 BMW X1 sDrive18i

2023 BMW X1 xDrive20i

Full Disclosure: The vehicles tested here were provided by BMW Australia for six days each, both with a full tank of fuel.

Patrick Jackson
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