The 1990s was a decade of profound change in Germany. The Berlin wall came crashing down to the halcyon sound of David Hasselhoff's voice, a nation once literally divided along warring ideologies was reunited, and all its people were free. Younger Germans, in particular, looked ahead with eagerness to prosperous new lives, to the opportunity to indulge in modern luxuries should they earn enough to afford them.

Therein lay a problem for the German domestic automakers. The overwhelming majority of their lineups were aimed at an older, wealthier audience. Cars like the E32 BMW 7-Series or the W124 Mercedes E-class weren't looking to hook younger buyers to the brands.

Going into the 1990s, BMW and Mercedes made cars for aging stockbrokers and bankers, not young people with new money. An entry into the front-wheel-driven markets to compete with VW and Opel would have been an unconscionable move for the big automakers who, at the time, banked so heavily on their prestigious reputations.

There was, however, something else that could work: an experiment with new body styles on existing architecture (a practice which the Germans continue to this day with their never-ending stream of new SUV coupes). These would be cheaper cars based on existing sedans. They would only have two doors, they would be shorter in overall length but, because young people like to carry lots of stuff, they'd be hatchbacks. But not front-drive hatchbacks like the pleasantly VW Golf. Oh no, these new Gen-X-bait cars would have the correct front-engine, rear-wheel-drive layout, for enthusiasts.

BMW made the first move, launching the 318 ti (318 Compact depending on region) in 1994, on the E36 chassis. Mercedes followed suit a few years later, introducing the C230 SportCoupé in 2001, on the W203 chassis (internally, the coupe was designated "CL203"). Decades later, both are largely forgotten, their memories tainted by later "budget" products from BMW and Merc that gave far worse impressions of either brand's true capacities for making cars.

They're both becoming cult cars today, but which one is better? Which one had a better package, which had the better drivetrain, and which of the two has aged the best?

Stubby Sedans Or Drivers' Hatchbacks?

1995 BMW 318ti
via bringatrailer.com

For the sake of simplicity, we will be comparing the North American specifications of both of these cars. As always with Euro cars, in their domestic markets there were far more engine and gearbox options than we received, and if you really dig, you'll find more subtle differences in tuning, suspension, brakes and so on.

The 3-series Compact was a big hit when it launched in its home market in 1994, such that BMW brought it to the US and Canada the following year, in 1995. It was marketed here as the 318 "ti" or "Touring International," although it was not a four-door wagon like other BMW Touring models. It was instead a 3-series coupe with 8.8 inches of length lopped off the back, and the trunk replaced with a liftback-style rear hatch.

MERCEDES-BENZ-C-Klasse-SportCoupe
via autoevolution.com

The Mercedes C230 SportCoupé followed the 318ti's concept, but with a much more contemporary look. Mercedes had been modernizing and softening up its boxy designs over the 1990s, and by the start of the new millennia it had an entirely new styling language relying on more fluid lines and organic shapes, which is the immediate and key difference between the silhouettes of these two cars.

Where the BMW is boxy and stubby, very much a product of its time, the Merc's shape is almost timeless. Seeing them on the road today, though the front half is recognizable as a W203, the overall design of the car looks far more modern than the Beamer, almost timeless. It doesn't look like a 20-year-old product, but the 318ti absolutely looks its age.

The C230 is only 7.3 inches shorter than a C-Class sedan, but its hatchback cargo area grows massively in volume to the three-box: up from 12 cubic feet to a massive 38 cu. ft. of cargo space with the rear seats folded.

The 318ti is equally practical, with an identical 38 cubic feet of cargo space with the rear seats down. The Mercedes is the overall bigger vehicle with more space in the cabin for all four passengers, but the BMW is frozen in a simpler time for car design. Its looks are less fussy to some eyes, and thankfully the E36 Compact didn't get the front fascia redesigns that BMW gave the later E46 Compacts in Europe.

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Would You Like Boost With That?

BMW 318ti M3 swap
via thedrive.com

These cars were launched at lower prices than their respective sedans, thus both had to make sacrifices under the hood to lower the cost. Neither of these vehicles was ever fitted from the factory with a six-cylinder engine, which didn't work to the favor of either of these cars when they launched Stateside.

Europeans aren't unfamiliar with BMWs and Mercedes' having small-displacement engines with four cylinders, but North Americans at the time were still hung up on these being luxury cars, and a crucial element of those sensitivities was horsepower.

BMW never caved in, and only ever offered the 318ti with a 1.8l "M42" dual-overhead cam inline-four making 138 horsepower. That engine was updated to a 1.9l "M44" unit with support for OBD-II connections, but failed to gain any horsepower. The car only weighed about 2,600 lbs., but less than 140 hp gave it a worse power-to-weight ratio than a base BRZ (which should be some indication that the 318ti wasn't a brisk automobile – 0-60 took about ten seconds).

Mercedes C230 coupe rear three quarter
via motortrend.com

The C230 SportCoupé was also restricted only to four cylinders, but Mercedes giveth where BMW taketh away. You may not have had the option for a creamy-smooth V6, but the C230's four-cylinder engines were supercharged, to produce 192 hp and 207 lb-ft of torque. As much was indicated by the car's "Kompressor" badging, and notable supercharger whine under acceleration.

The first of two engine models was the 2.3l "M111," but early complaints of poor NVH  would see it replaced during the car's production run with a 1.8l supercharged four-pot, the "M273," tuned for identical power and torque output. It may have made considerably more power than the 318ti, but it was also about 800 pounds heavier, with a total curb weight of 3,400 lbs.

Both cars came with manual or automatic transmissions, though Merc's 722.6 5-speed automatic was a smoother and more reliable unit than BMW's 4-speed auto. Both manuals were 5-speed units, and both fed into a limited-slip differential at the rear.

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Which Cult To Buy Into?

BMW 318ti overhead view
via press.bmwgroup.com

Naturally, these budget spin-off sport-hatchbacks are becoming what's commonly referred to as "cult cars." These are cars which may not be impressive at any particular metric of driving, or cars that are widely regarded as bad cars yet owners and enthusiasts adore them and can be particularly rabid about buying, selling and collecting them.

The E36 chassis is having a rebirth in the 2020s. They're becoming less common than newer models and, in some ways, they're much cheaper to run. These are low-tech cars by BMW's standards, and though you'd be crazy to suggest a 25-year-old German car will be what North America considers "reliable," it is nonetheless a mechanically-simple machine that DIY mechanics can maintain.

BMW 318tis are fairly elusive cars, with only around 25,000 ever sold in North America (it was a far better seller in its home market, achieving nearly half a million models sold), but even so, the nicest ones barely clear the $10,000 USD mark on Bring-a-Trailer. Vehicles with higher mileage and some wear and tear can often be found for less than half that.

Mercedes C230 sportcoupe driving side view
via autoevolution.com

It's a similar story for the C230 SportCoupé. Even with its unique Kompressor supercharged engines and new-age design, it failed to make significant improvements to the 318ti's sales record, which went out of production by the time the Merc launched.

However, the C230 is still a much newer vehicle, thus more of them are still on the road and being maintained. You can find them in varying states of repair anywhere from a few thousand dollars to around $8,000 to $10,000 for the nicest ones. Despite the complexity of supercharging, the W203 platform isn't known to be a particularly difficult and expensive car to maintain, though we'd be remiss not to remind you to approach either of these with caution.

Look for rust too, as both the E36 and W203, like most cars, have some known rust points that can be tricky to repair and could sink the value of your car.

Neither of these cars will be remembered like the top-end performance vehicles they shared platforms with, but they're both from a severely endangered species: practical, affordable RWD cars. That alone makes them worthy of our interest, but beyond that, these cars are both curious exercises in design and approaches to entry-level luxury that can both now be had for a song.

If it was our money, we'd try to find a W203 C230 SportCoupé with low miles and a manual gearbox, because supercharger whine is one of the automotive world's best sounds.

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