The Deep Dive: New Luxury, Small Packages

Even as Americans embrace more expensive compact cars, they remain immune to the charms of the premium hatchbacks that sell so well in Europe. In the United States — and, just as important, in China — the sedan remains king. That’s why the German premium brands are working on front-wheel-drive compacts with four doors and proper trunks.

Mercedes-Benz will be first out of the gate. Its long-anticipated CLA-class, pictured below, goes on sale in the U.S. this fall. The baby CLS — which looks just as good as its papa — shares its underpinnings with the front-wheel-drive A-class hatchback but is actually longer than the more expensive C-class. Perhaps that’s why Mercedes expects this model to take on the Audi A4 and the BMW 3-Series, claiming comparable packaging and performance. So far, Mercedes has confirmed that it will offer a 208-hp, 2.0-liter four-cylinder in America with optional all-wheel drive. A 350-hp AMG version is on the way. Mercedes has also developed an electric powertrain for this platform (a collaboration with Tesla), but it seems that it won’t be offered in the CLA. A plug-in hybrid is more likely.

Audi’s response arrives in 2014 in the form of a more luxurious sedan variant of the A3. The engines most likely for the U.S. include a 1.8-liter turbocharged gasoline engine producing 180 hp and a 185-hp version of Volkswagen’s familiar 2.0-liter turbo-diesel. Quattro all-wheel drive will be an option. The S3 comes later and will offer a 2.0-liter turbo good for 300 hp, which should be more than enough to separate it from the Volkswagen GTI. A 380-hp RS3 is also possible but is unconfirmed.

BMW will be late to the party, which may explain why, in the meantime, it unveiled a cheaper, less-powerful 3-series called the 320i. It has been working on a front-wheel-drive 1-series for a while but initially intended to limit the sedan version to China. (As we’ve reported, the coupe and convertible remain rear-wheel drive and become the 2-series.) The proportions of the sedan, likely to arrive in 2016, hark back to the 2002 and the first-generation 3-series. Like the next-generation Mini, with which the front-wheel-drive 1-series shares its underpinnings, the sedan will offer BMW’s 1.5-liter three-cylinder. For the United States, though, BMW may stick with a four-cylinder, such as the 180-hp 2.0-liter from the 320i. The inevitable
M model will pack about 270 hp and offer all-wheel drive.