As fast and powerful as the latest BMW M3 is, some aren’t exactly taken by its looks. Not to mention, a new M3 isn’t exactly cheap. However, a used M3 offers similar performance at a significantly more affordable price. Plus, in some cases, these older BMWs are more fun and communicative than their new counterparts. And if you want a prime example, look no further than this week’s Bring a Trailer bargain car: a 2006 E46 BMW M3 Competition.

Hagerty calls the E46 BMW “peak M3”—and the ZCP Competition Package moved the peak even higher

The M3 has come a long way from the original E30. While that car was a genuine race car for the road, its successors were more luxurious and road-focused. But they never lost their performance edge, even though each generation offered a distinctly different take on the matter.

For example, the E36 M3 softened the E30 formula just enough to make a quality road car. And the E90/E92 M3 is the only model with a V8. But while the E90/E92 M3 is still a highly-praised sports car, it’s not the best M3, Hagerty argues. That honor belongs to its predecessor and the E36’s successor, a car some consider “the greatest M car ever built,” Road & Track says. That car is the 2000-2006 E46 BMW M3.

Like the E30 and E36 before it, the E46 M3 has a naturally-aspirated inline-six engine. It’s the 3.2-liter ‘S54,’ one of the last naturally-aspirated engines M Division used. This “gorgeous gem” of a motor, as Hagerty calls it, makes 333 hp and 262 lb-ft of torque. That goes to the rear wheels via a limited-slip differential and either a six-speed manual or, starting in 2001, an optional six-speed single-clutch automated manual. Regardless of the transmission, though, the E46 BMW M3 goes 0-60 mph in less than five seconds.

Straight-line speed, though, isn’t the E46 M3’s main forte. stiffened the E46’s chassis, installed new aluminum suspension components, widened the track, and upgraded the brakes. The company added a front strut-tower brace in 2002 and a revised steering rack late in 2004, R&T says. All of this added up to a fun-to-drive car that’s still lauded today.

There’s a Dinan-modified 2006 M3 ZCP up for auction on Bring a Trailer

But if the ‘regular’ E46 BMW M3 is “peak M3,” the 2005 and 2006 M3 Competition is peak E46. Avoiding a repeat of the E36 M3 GT situation, BMW brought over some of the Euro-only E46 M3 CSL’s goodies in the ZCP Competition Package, MotorTrend explains. It added a quicker steering ratio, Alcantara steering wheel, additional driving mode, 19” alloy wheels, larger cross-drilled front brakes, and tweaked suspension components. And it made an already great car even better.

The 2006 E46 BMW M3 currently listed on Bring a Trailer has that Competition Package. So, on top of all the other features, it also has adjustable stability control, traction control, bolstered heated front sport seats, and a trunk-lid spoiler. Plus, it has xenon headlights, LED taillights, rain-sensing wipers, a sunroof, fog lights, automatic climate control, and a Harman Kardon audio system with Bluetooth.

However, this 2006 BMW M3 Competition isn’t stock. It has multiple components from Dinan, a factory-approved BMW tuner. Those components include a short-shifter kit, performance exhaust, LSD, high-flow air mass meter, pedal covers, throttle bodies, and a Stage 4 ECU tune. There are also several Dinan suspension components, as well as upgraded trailing arms. Plus, this car has a hardwired Valentine radio detector and a reinforced rear subframe.

It’s worth noting that this 2006 E46 BMW M3 Competition does have two accidents—including a minor one—in its history. However, it doesn’t appear to show any remaining signs of damage. And apart from that and some paint chips, it’s in good shape for a 125,000-mile car. In addition, the S54 engine’s rod bearings were recently serviced for recall work; the LSD was resealed at the same time. Also, the fuel filter, engine mounts, drive belts, and oil-pressure inlet valve were replaced three years ago.

This E46 BMW M3 Competition is a bargain-priced high-water mark, but will it be reliable?

As of this writing, this 2006 E46 BMW M3 Competition is listed on BaT for $8250 with two days left in the auction. True, it’s a modified example with some accident history. But even so, a fair-condition manual E46 M3 ZCP usually costs about three times as much, Hagerty says. In short, this coupe is a real performance bargain.

As with any used car, a pre-purchase inspection is recommended. However, in this 2006 car’s case, the rod bearings and rear subframe have already been addressed. Those are the biggest E46 headaches, along with the SMG transmission, which this car doesn’t have. The only remaining ones are VANOS and water pump failure, BMW Tuning says. But those are common BMW engine issues. And in terms of maintenance, the only thing this BMW M3 Competition might need is a valve adjustment.

In short, this is a well-modified, affordable example of arguably the best M3 generation. If that’s something you’ve been after, this car might be worth bidding on.

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