The last time we looked at the Nissan Versa, in October of 2010, it was the cheapest car in America at under 10 grand. Unfortunately, the price for such a low sticker was dearer than its four-digit sticker. The lack of modern essentials like air conditioning, anti-lock brakes and automatic transmission were more than just a bummer, as adding them to the Versa made the car less than cheap. For the first redesign of Nissan’s smallest family hauler, the boffins in Japan decided to attack the sedan first for an update, an interesting decision as the sedan only accounts for a supposed 30-35% of all Versa sales on our shores. Surprised? I was, especially since hatchback sales in the US are finally on fire. Nissan graciously invited us to Seattle so we could get down and dirty with the Versa before it arrives on showroom floors in August.

From the outside, the Versa (known as the Nissan Sunny or Nissan Tiida in other markets) looks considerably more grown up than its predecessor. Swoopy lines and the bold trapezoidal “signature” grille could almost be products of Infiniti. Nissan tells us to expect this schnoz to be adapted to all Nissan vehicles eventually. Out back, the trunk is acceptably well executed, prompting a sigh of relief as so many small cars get the rump all wrong. Hatchback lovers shouldn’t expect a new Versa hatchback soon; Nissan was tightlipped about a new hatch meaning we’ll probably see it in 2013, but that’s just a guess.

While some may scoff at hard plastics, the low base price of the Versa has always forgiven the econobox many faults and the new Versa is no different. Interior plastics are no snazzier than they were in the previous version meaning hard plastic dash and door bits are the name of the game. Still, the texture and color of the plastics are far less distracting than some of the alternatives coming out of Detroit regardless or price.

Under the hood beats an all-new 1.6L four-cylinder engine with dual variable valve timing and dual injectors per cylinder, good for 109HP at 6,000 RPM and 107 lb-ft of twist at 4,400 RPM. Fortunately for sedan buyers, the sedan now comes with a CVT instead of ye olde 4-speed auto. The new transmission incorporates the usual cone/belt arrangement and adds a novel twist: a two-speed planetary gearset giving this second-gen CVT a broader range than most 7-speed autos. Thanks to this crossbreed transmission and a slight weight reduction compared to the outgoing model, the loss of 13HP vs the old 1.8L engine goes largely unnoticed, and with EPA numbers on the rise most buyers won’t mind.

Because I had to share my driving time with a colleague from About.com, (and keeping in mind we were driving a pre-production vehicle) my experiences are based on some 80-miles in Seattle on mostly city streets with brief highway runs. Based on this fleeting encounter I’ll leave the majority of driving impressions to a full review. I can however say that the suspension is well sorted and composed even on the broken and under-construction pavement currently plaguing the Pacific Northwest, and the electric power steering is no worse than any of the others on offer in this segment. Acceleration is leisurely in relative terms, but not appreciably slower than vehicles like a Prius or Civic Hybrid. A quick test with our accelerometer resulted in a 0-60 time of 11.65 seconds. Nissan announced 2008 EPA numbers of 30/38/33 (City/Highway/Combined) and we averaged 29-34 MPG during our short time with the vehicle and mostly city driving making the Versa both cheap and frugal.

Safety has been on Nissan’s short list for a while and the Versa is no different, sporting all the safety gizmos mid-size car buyers expect. Side curtain airbags, ABS with electronic brake force distribution, emergency brake assist, and seatbelt pre-tensioners with load limiters are all standard on even the base model. The only item conspicuously absent from the Versa’s safety list is Nissan’s active headrest, pity; it would round out all my favorite acronyms and would be a nice touch on the top-end low cost car.

Speaking of dollars, the Nissan Versa lineup starts with the base Versa S equipped with a 5-speed manual for $10,990 which now includes a radio with CD player (and AUX input) and two speakers (yes, just two) and air conditioning. (We were unable to test drive the manual-equipped sedan so I can’t comment on that model’s specifics). I have this feeling that most buyers will opt for the Versa S, a single step-up from the bottom. The S with CVT will set you back $12,760 but also brings a “high efficiency” alternator and wind deflectors to the party. For $350 more you can get cruise control and two extra speakers, good value in my book. The $14,560 Versa SV model bring power windows and door locks, standard cruise control, upgraded cloth seats, and some shiny chrome bits. $350 extra gets the SV Bluetooth phone connectivity with steering wheel controls, map lights, vanity mirrors and iPod control.

Top-line SL buyers get alloy wheels, fog lights, a split folding rear seat, Bluetooth, the aforementioned shiny bits and some cloth inserts in the door panels. Non-apple lovers will need to buy the SL and cough-up the $700 tech package to get the navigation system with USB interface. In addition the ability to browse tunes on your various USB devices, the 7-Benjamins buys an easy to use navigation system with XM radio and NavTraffic (service fees apply and it’s only available in the SL model). While $700 is a touch steep compared to the $199 Garmin special at your local box store, the look is well integrated with the steering wheel controls and in my book worth the extra dosh. This makes the fully-loaded price of the Nissan Versa some $16,260. Add in a $760 destination fee, subtract some inevitable wiggle room and it may actually possible to get a fully loaded Versa for under $17K plus tax.

On the electronic goody and luxury front, the new Versa attempts to be the best budget value without stepping on Sentra’s toes as the old Versa tended to in higher trims. For buyers this means niceties like the long-awaited center armrest, key-less go, and hidden cubbies for your USB devices are all gone. While I will mourn their loss as a tech-weenie, in their place comes standard air conditioning, anti-lock brakes, improved fuel economy and a new CVT.

Despite a base MSRP increase from $9,990 to $10,990, the Versa is likely to still be the cheapest car in America. Fortunately for the frugal shopper, the base price increase also means less of a penalty box than was checked in 2011 with A/C and anti-lock brakes now standard.

Real competition for the Versa can be seen in the form of the Hyundai Accent GLS when equipped with the manual transmission and air conditioning. So equipped, the Accent will run you $14,195 and the Versa S clocks in at $10,990, a difference of $3,205 which Nissan is quick to point out. On the surface, the Versa looks to deliver exactly what Nissan promises: cheap transportation without being a penalty box. When the Versa goes on sale in August of this year we’ll be sure to update our best & brightest with a full review. Until then, sound off in the comment section below: should buyers get an $11,000 new car with a warranty or something cheap in the certified pre-owned category? Is that the Versa’s real competitor?

Nissan flew me up to Seattle, put me up in a swanky hotel with free flowing drink, and provided the vehicle, insurance and gasoline for this review.

Statistics as tested

0-30: 3.75 seconds

0-60: 11.65 seconds

1/4 Mile: 18.44 seconds @ 76MPH

With the 2004 X3, BMW offered a compact SUV a half-decade ahead of other German car manufacturers. So not long after Audi and Mercedes have introduced their first such vehicle BMW has an all-new second-generation X3. The first-generation X3 had its strengths, but its weaknesses tended to outweigh them, especially in the U.S. market. The larger X5 has outsold it on this side of the Atlantic many times over despite a higher price. Has BMW learned enough in the past seven years to address these weaknesses and keep ahead of the new competition?

Though its U.S. launch is delayed, an even more compact X1 is already available in Europe. To make room for it, and to fill the void created when the X5 was enlarged three years ago, the new X3 has gained three inches of length and an inch of width (but, unlike other recently redesigned BMWs, less than 50 pounds of weight). The new X3’s exterior styling strongly resembles the original’s, but more substantial and refined surfaces help it appear more up-to-date, more solid, and more worthy of a lofty Monroney. The creases over the wheel openings seem extraneous, but at least they’re subtle. The body rides lower over the wheels, for a more car-like stance, perhaps because BMW figured out that few (if any) X3 owners were venturing off the road or even wanted to look like they might. (According to the specs, there’s actually a half-inch more ground clearance, so the mechanical bits must be tucked in more tightly.) The X5 continues to appear brawnier, thanks to more muscular fenders. The Audi Q5 is prettier, while the Mercedes-Benz GLK appears more rugged, but the X3 looks the sportiest of the three when fitted with suitable wheels.

The original X3 was roundly slammed for its cut-rate cabin. A mid-cycle refresh upgraded materials, and the 2011 is another step up. The new interior looks and feels more substantial. Unlike the 2004’s, it’s on par with that of the contemporary 3-Series. There are more curves than inside most other current BMWs, even a bit of the driver-orientation for which the marque’s instrument panels used to be known, but there’s still much less style for the sake of style than you’ll find elsewhere. And yet the controls are too unconventional and too complicated to award any prizes for functionality. Even the shifter, the monostatic sort BMW has been putting in everything, feels odd and requires more conscious attention than a shifter ought to.

Inside the larger, lower-riding body there’s over an inch more headroom, 1.5 inches more front shoulder room, and an inch more rear legroom (unless you’re very tall, you’ll fit). These differences don’t sound like much, but the feeling from the driver’s seat is much different. The new X3 seems roomier, but even more than this it seems like a larger, more substantial vehicle. And a bit more car-like as well (if still notably less so than the Audi). Credit a higher beltline and a less upright, more distant windshield flanked by thicker pillars. The driver’s seat is standard BMW fare, so very supportive and comfortable, but not cushy. Unlike in the new 5-Series, the optional sport seats include power-adjustable side bolsters, so there’s no need to compromise lateral support for many of us in order to provide enough space for XXL drivers.

The specs suggest cargo volume is down, from 71.0 cubic feet to 63.3. But BMW’s literature claims it’s actually up by 15 percent. Apparently the method used to measure cargo volume changed. Cases like this are why I never have much faith in cargo volume specifications—there are too many variables and no fixed standards, even within a given manufacturer. My eyes say the new X3 is competitive in this area.

The BMW X3 was initially offered with a 2.5-liter as well as a 3.0-liter inline six, but the former was dropped years ago. For 2011, the retuned six loses 20 horsepower, for a total of 240, but is also available in 300 horsepower turbocharged form. The unboosted six provides decent performance, but doesn’t feel as strong or sound as sonorous as the 265-horsepower V6 in the Audi Q5. The turbo easily blows by both of them, with an audible whoosh. As in other BMWs, this engine feels much stronger than its official 300-horsepower rating. In this segment, only the 325-horsepower turbocharged inline six that will be available in the 2012 Volvo XC60 R-Spec can hope to keep up. My suspicion: the Volvo won’t be quite as quick, partly because of gearing, but its six will sound better. The BMW six doesn’t sound bad, but the Volvo’s voice is lovely.

A manual transmission is no longer available in the X3. The automatic is an eight-speed unit that can get a bit busy, especially with the base engine. Unless your foot is deep in the throttle little time is spent in the first two gears. Thanks to the extra ratios, electric-assist steering, and a clutched alternator, fuel economy is up, from 17/24 to 19/25 for the xDrive28i and 19/26 for the xDrive35i (yes, the stronger engine actually does equally well in the city and a bit better on the highway).

With its reduced ride height and almost exactly 50:50 weight distribution, the new X3 feels more balanced and more composed through curves than the nose-heavy, less tightly damped Audi Q5, next best in the segment for chassis dynamics (unless Volvo has worked wonders with the 2012 XC60 R-Spec). To be (un)fair, BMW provided a Q5 without the optional “DriveSelect” adjustable steering and adaptive shocks. Typical of the marque, the BMW can be placed very precisely and rarely surprises. Driving it quickly soon becomes far more intuitive than the iDrive control system can ever hope to be.

Both tested X3s were fitted with the $1,400 Dynamic Handling Package, while includes “variable sport steering,” “performance control,” adaptive shocks, and a button to vary these bits, the throttle, and the transmission among three settings. “Performance control” modulates the brakes to provide a hint of oversteer through turns. It cannot be turned off, both 2011 X3s I drove had it, so I cannot attest how much difference it makes. “Variable sport steering” isn’t the same as active steering. Instead of being able to vary the ratio continuously and at any time, the ratio simply quickens as the wheel approaches the lock. This system is simpler and more predictable, but cannot dramatically vary the ratio on center the way active steering can. The selectable modes affect the firmness of the steering, but more at highway speeds than below 40. No matter what the setting, the X3’s steering feels more artificial and provides less nuanced feedback than the outstanding conventional system in the Audi Q5.

Ride quality was the second glaring weakness of the original X3, and probably the main reason people initially interested in the small SUV didn’t end up buying one. The 2011 rides much more smoothly, at least when fitted with the adaptive shocks (and quite likely without them as well). The different modes make little difference here; in “Sport+” impacts are a little sharper, but the ride remains comfortable. In “Normal” the ride can feel a touch underdamped on some roads; “Sport” strikes a nice compromise. The downside of the improved ride: combine the more compliant suspension with the artificial steering and the less intimate driving position, and the new X3 feels larger, less agile, and less direct than the original. There’s less wind and road noise than in the Audi, but this says more about the Q5 than the X3.

The 2011 BMW X3 xDrive28i starts at $37,625, $2,100 less than the 2010. According to TrueDelta’s car price comparison tool, the new SUV also includes over $800 in additional standard features, for a total price reduction of nearly $3,000. The xDrive35i starts at $41,925, and its standard xenon headlights and wood trim account for $1,400 of the difference at BMW prices, leaving $2,900 for the turbocharger. The upshot: once features (not including the engine) are adjusted for, the new xDrive35i costs about the same as last year’s much less powerful, fatally flawed vehicle.

These being BMWs, adding options quickly leaves these base prices in the dust. A half dozen packages and metallic paint bumped the tested 28i and 35i to $50,775 and $54,075, respectively. And, lacking the premium audio system, the head-up display, and the M Sport Package, these weren’t even fully loaded.

Comparably equip an Audi Q5 3.2, and it’s over $3,000 more than the xDrive28i and about even with the xDrive35i. The Infinity EX35 is the segment’s budget buy, checking in about $6,000 below a comparably-equipped X3 xDrive35i. Adjusting for remaining feature differences cuts the difference to about $4,400. The Infiniti is much more cramped inside and feels a bit dated at this point, so this premium seems warranted. As premium compact SUVs go, the new X3 is attractively priced.

The 2011 BMW X3 addresses the two glaring weaknesses of the original—interior materials and ride quality—while looking and feeling more refined and substantial. A new, much less fatal flaw: despite (or perhaps because of) extensive electronic wizardry, the X3’s steering lacks the natural, wonderfully nuanced feel of the Q5’s. For this one reason I enjoyed driving the Audi more. But by any objective measure, and nearly any subjective measure as well, the second time is the charm.

The vehicles for this review were made available at an event for BMW owners.

Michael Karesh operates TrueDelta, an online source of automotive pricing and reliability data.