When it comes to compact executive sedans, the BMW 3 Series is arguably the most popular, as well as the most influential. It’s been around for decades, and has remained the brand’s best-selling model for much of its life. Because it’s so popular, the 3 Series is also well sought-after in the used market, as many buyers want BMW engineering in their lives but can’t necessarily afford a brand-new one.
Speaking of affordability, one such modern 3 Series is experiencing a significant used-market price cut: the F30-generation 320i. It was the entry-level model in the fabled lineup, sold between 2013 and 2018 in the US market. Its surprising affordability isn’t necessarily due to reliability issues or anything of the sort, although those do play a small part; rather, it comes down to BMW’s sales strategy. Because so many were leased when new, the 320i now stands as one of the most affordable BMW models produced during the latter half of the 2010s.
BMW Flooded Its Own Used Car Market
2012 BMW 335i front 3/4BMW
The F30, much like most other four-door 3 Series generations, was a high-volume seller for BMW. During its tenure, the Bavarian automaker managed to sell roughly 2.6 million examples worldwide, making it one of the best-selling compact executives on the market at the time. However, we say “sold”, but the fact of the matter is, many of those 2.6 million units were actually leased.
For those unfamiliar with the concept, leasing a car is much like renting an apartment. You sign a document, gaining rights over the use of the apartment, but your monthly payments are solely for the right to use the space. You’re not building equity in the property, and you can’t sell it. A leased car is similar: you pay for the right to use it, but you can’t sell it because you don’t actually own it.
Once a car lease term is up, which is usually three years, you need to return it or buy it outright. If you decide to return it, the leased car goes back to the manufacturer, that being BMW in the 320i’s case. It’s important to note that much of BMW’s business model is centered around leasing, as many buyers would rather not purchase a rapidly depreciating luxury car outright. Not to mention, lease payments are often lower than payments incurred via purchasing.
It’s reported that roughly 60 to 65 percent of all BMW business is centered around leasing, and the F30-gen 320i, allegedly, leased at percentages higher than that. This means a large number of models were returned to BMW, and the brand needed to sell them on the open market to recoup some profit. Because of this, there’s a persistent, year-over-year supply increase, driving demand down, which then drives prices down.
Front-quarter shot of a 2012 BMW 328iBMW
Those currently on the used market are in a unique spot, thanks to the magic of ex-lease BMW depreciation. The F30-gen 320i offers buyers a way to get into a relatively modern BMW at a very agreeable price.
The F30 320i Is A Full-Blooded BMW
2012-2015 BMW 3 SeriesBMW
Just because it’s depreciated rapidly doesn’t mean the F30 320i isn’t a venerable compact executive model. Being a BMW, the model comes standard with rear-wheel drive, with the brand’s xDrive all-wheel drive sitting as the optional upgrade. Its chassis is well-balanced with a near-perfect 50:50 weight distribution, making it extremely planted and well-mannered when exposed to some particularly enthusiastic driving. Its four-cylinder engine is mounted longitudinally rather than transversely, meaning more of the engine’s weight sits behind the front axle.
BMW N20 Engine BMW
Speaking of its engine, the F30 320i is powered by BMW’s 2.0-liter N20B20 turbocharged four-cylinder, producing 181 horsepower and 200 pound-feet of torque. It leverages its compact dimensions efficiently, achieving a combined fuel economy rating of 28 mpg in rear-drive models. An eight-speed automatic transmission came standard, although a rare six-speed manual was offered, too.
Come 2015, BMW replaced the N20B20 engine with the B48B20 mill. It has the exact same power figures, but comes with a few differences, such as a closed-deck block design and a slightly different bore:stroke measurement, with it gaining a more undersquare make-up. For more context, an undersquare engine has a piston stroke that’s longer than its cylinder bores are wide.
2018 BMW 3 Series B48 engineBMW
Despite the modest power figures, buyers of a used F30 320i are getting much the same engineering found in BMW’s more powerful models. Its near-perfect weight distribution and finely tuned chassis are all decidedly BMW. Its smaller engine simply means you might not be able to beat Chevrolet Corvettes or Toyota Supras off the line, but you’ll have just as much fun through the corners.
Maintenance Costs Helped Drive Prices Down
2012-2015 BMW 3 SeriesBMW
Now that we’ve established that the F30 320i can still hold its own, it’s time to inject some reality into the model’s current situation. It’s no secret that many luxury models, German ones in particular, can rack up significant maintenance costs once the car’s warranty expires. The 320i is no exception, and because the market is directly affected by things like a model’s reliability, its prices are pushed even further down.
Over the course of a single year, RepairPal estimates the F30 320i to cost about $911 to maintain, although the source also offers a range of $820 to $1,002 per year. For a small, entry-level compact executive, that’s a steep price to pay for routine maintenance. Of course, now that the newest iteration of the F30 320i turns eight this year, there’s no semblance of a factory warranty remaining, and it’s also no longer eligible for a certified pre-owned warranty.
Arguably, the F30 320i’s Achilles’ heel is its N20 engine. It’s been widely reported by numerous owners that it suffers from timing chain guide issues. Once the parts start to fail, a high-pitched whine will be heard from the engine, along with a cold-start rattle. Should the issue be ignored, the timing chain can jump, causing potentially catastrophic damage to the engine. This severely damaged both the car’s and the engine’s reputation among BMW buyers. BMW fixed the issue with new guides in early 2015, but the issue wasn’t fully rectified until the introduction of the B48B20 later that year.
Typically, buyers who have their ear to the ground will sniff out, and avoid, cars with major issues such as the early F30 320i’s timing chain guide problem. However, because it affected the entire 320i lineup, those who opt for models built after early 2015 can take advantage of the reduced price without taking on nearly as much risk of timing chain guide failure.
Depreciation Did The Dirty Work For You
2012-2015 BMW 3 SeriesBMW
Buyers and lessees who opted for a brand-new F30 320i didn’t necessarily benefit from doing so, especially those who purchased an early, N20-equipped model. However, now, used market shoppers are in a great spot to save an impressive amount of money while also having the knowledge of which 320is to avoid because the hard work and lessons learned were already completed by previous owners.
As for concrete depreciation figures, the F30 320i loses roughly 45 to 55 percent of its value over just five years. And, according to iSeeCars, the model suffers from 73.7% depreciation over a period of 10 years. This means well-maintained F30 320is can be had for agreeable prices, and for those who are able to budget for potential maintenance costs, this bodes extremely well for the model’s value for money.
However, before browsing listings, make sure to take a couple of things into account. For one, make sure you avoid early N20-equipped F30 320is, as nobody wants to drop thousands on timing chain guide replacements. Also, whichever example you buy, make sure it has detailed service records. If the model in question is an early one, see if the chain guides were replaced. If not, we strongly suggest walking away and finding another example.
So, while heavy leasing volume did hinder the F30 BMW 320i’s residual value, a brief period during which the N20 engine proved unreliable helped drive it down further. Both of these circumstances helped to create this unique, value-filled period of time when you can get into a well-sorted, modern BMW sedan for a low price.
Sources: BMW, BMWBlog, iSeeCars, CarEdge, RepairPal.
