In May 1995, the general exterior design of the E46 by Erik Goplen of DesignworksUSA was approved and as a result DesignworksUSA was contracted by BMW to work alongside BMW Group's in-house design team to create the exterior bodywork for the 3 Series range in February 1996. In late 1993, design work began under chief designer Chris Bangle and continued into 1995. In 1993, the development programme for the E46 began under chief engineer Wolfgang Ziebart and head of R&D Wolfgang Reitzle. However, the E46 coupé and convertible body styles remained in production until August 2006.

The E46 line-up was phased out starting from late 2004, following the introduction of the E90 3 Series sedans. It is powered by the BMW S54 straight-six engine with either a 6-speed manual or a 6-speed SMG-II automated manual transmission. The M3 performance model was introduced in June 2000 with a coupé body style, followed by the convertible counterpart in April 2001. The latter has been marketed as the 3 Series Compact. First introduced in November 1997, the E46 was available in sedan, coupé, convertible, station wagon and hatchback body styles. The BMW E46 is the fourth generation of the BMW 3 Series range of compact executive cars, which was produced by the German automaker BMW from 1997 to 2006, and was the successor to the E36, which ceased production in 2000.

2003 e46 m3 specs