BMW has made incredible strides in terms of fuel economy. And the good news is that thrift at the pumps does not have to come at the cost of lower performance. At least that's my verdict after driving the new entry level BMW 316d, which has been made even more attractive by a 10.5 per cent drop in price. I took the entry level BMW 316d to the road and, the more that I drive a BMW diesel, the more I can appreciate the progress that the German carmaker has made in terms of fuel economy.

BMW's entry level 316d model has impressive fuel economy at 4.5 litres/100km fuel economy and now its more than 10.5% drop cheaper following a change in prices. The entry price at €33,440 is still high for a relatively compact car that's impressive to drive.

This new BMW 316d is one of the most cost efficient cars to run in its segment of the market, both in terms of CO2 rating and fuel economy. There is still a slight premium when it comes to price, even if the price is reduced, and I believe that it's worth it.

This entry level BMW diesel comes with 1995cc engine, even if the badge says 316d. This engine, as is fitted to the more powerful 318d and 320d models with some fuel system and more combustion technology changes, to get more power form the 318d and 320d.

What's key to this engine is the fact that it comes with the BMW EfficientDynamics system. This system uses with brake energy regeneration, auto start/stop function and shift point display for the manual versions to help manage the fuel consumption levels. BMW claims that the car's auxiliary systems are more efficient because the steering system is now an electro-mechanical one. All of these cars now come with low rolling resistance tyres to reduce the load on the cars engine.

During my recent test drive, I found that the car delivered close to the rated economy figure of 4.5 litres/100km (62mpg). I drove with care more than caution and still the economy figure came in at one of the best in the segment. The slightly more powerful 318d and 320d models are the only cars to challenge it.

The engine power is modest at 116bhp; the torque figure equally so at 260Nm. Combine this with a relatively light car and the 316d means accelerates well. The 0 to 100km/hr acceleration figure is 10.9 seconds. And that's better than the average for the group of 20 cars that I compared it with. For most drivers, the pace will be adequate and further appreciated when it delivers such good economy figures.

Like the other BMW 3 Series models that I have driven, the driving position is good while the road holding is firm and positive. The seating on the test car was firm. The 3 Series is not a big car; rear leg and headroom is not that impressive. The boot is just adequate.

The layout of the 3 Series controls is clear. I found that the Bluetooth mobile phone connection was easy to set up. The BMW 3 Series appeal is a combination of styling and image. There is a practical nature to the car that is not always considered. This styling works well for the 3 Series because there's still a hint of luxury or something special to the car.

The BMW 316d comes with six airbags as standard as well as front and rear ISOFIX child seat mounting kits. The seats come with active head restraints designed to reduce spinal injuries in the event of a rear-end collision. None of the BMW 3 Series models have had a recent Euro NCAP safety test. When it happens, it should score well.

The BMW 3 Series is now better value than ever before. The BMW 316d price has dropped by over ten per cent to €33,440 (€3,875 off the previous price), which adds significantly to the value.

It may still be a shade expensive for a relatively modest size car but it's getting close to the cost of a 2.0 litre Ford Mondeo and the Passat BlueMotion diesel. These are bigger cars with more passenger and boot space.

The new BMW 316d brings a new sense of value, both in terms of buying price and the running costs. The low CO2 rating means a low annual tax rate of €104.

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