MUNICH/INGOLSTADT, Germany - Audi and BMW are following the trend toward leisure-oriented vehicles with excellent on-road performance and reliable off-road capability.
BMW has launched the 330xi and Audi the all-road Quattro, both with four-wheel drive as the main selling point.
The BMW 330xi is available in four-door sedan and Touring (station wagon) versions.
'We have had many customers asking for four-wheel drive as an option, both in Alpine countries and increasingly in lifestyle markets, too,' said Gerhard Schmidt, head of engine and drivetrain development at BMW.
Only an additional 150mm ground clearance differentiates the 330xi from the appearance of the regular 3 series.
The 330xi's electronically controlled four-wheel-drive system has been carried over from the X5 sport-utility. It transmits 62 percent of the engine's power to the rear wheels and 38 percent to the front wheels.
BMW will introduce a 330xd version with a 3.0-liter, 184hp diesel engine in September.
A decade ago, BMW offered a four-wheel-drive system for the 3 series. But fewer than 5 percent of 3 series customers chose that option. Today, Schmidt does not expect demand for the x-version to exceed 5 percent of overall 3 series sales. But the popularity of the 3 series has more than doubled since the late 1980s - and economies of scale also can be achieved by sharing the four-wheel-drive system with the X5.
BMW forecasts that most of the x-option customers will choose the Touring version.
BMW denies the 330xi and 330xd will only serve as short-term solutions, closing a gap in its product lineup until the smaller X3 sport-utility arrives.
'We will have the two concepts running in parallel,' said a BMW spokesman. 'Of course, there's a trend toward sporty SUVs. But four-wheel-drive passenger cars are also becoming increasingly popular - in the USA as well as in Europe.'
That is confirmed by Audi's quattro sales, which have risen significantly in the past two years. Quattro vehicles currently account for one-third of Audi's overall sales.
Quattro - Italian for 'four' - was adopted by Audi in 1980 to designate its four-wheel-drive models.
The new allroad quattro is the Audi's first entry into the sport-utility market.
Audi said it decided to launch the allroad quattro because customers' tastes are shifting to crossover concepts that blend the advantages of station wagons with off-road vehicles.
This trend is particularly strong in the US, where the allroad quattro will enter the market with a light-truck certification in the fourth quarter of this year. US light-truck certification offers tax benefits to the customer and imposes less strict fuel consumption and emission limits on vehicles.
'All our (US) competitors are certified as light trucks, so we wanted our US customers to benefit from the tax rules as well,' said Audi Chairman Franz-Josef Paefgen.
A four-level air suspension system 'makes it possible to vary the allroad quattro's ground clearance by up to 66mm,' said Paefgen. 'As well as the manual control mechanism there is also an automatic ride height control system that sets the ideal ground clearance depending on speed.'
Capacity for the allroad quattro at Audi's plant in Neckarsulm, Germany, is currently limited to 20,000 units a year.
'This is a very conservative forecast,' said Paefgen. 'But the target customer group is very unclear and we want to gain experience in this market first. We will see what the demand is and then adjust our output accordingly.'