BMW is adding yet another model to its M performance division and this time, it looks like it's based on the 2 Series. The company already has the M2 in the fold, so now it’s giving the 2 Series GranCoupé the M treatment with the impending launch of the 365-horsepower M2 GranCoupé.

According to Autocar, BMW is preparing the M2 GranCoupé to serve as a direct challenger to the Audi RS3 and the Mercedes-AMG CLA 45, two cars that have been staking their claim in the compact performance segment. Not much is known about what the sports car is going to look like, but there have been a lot of discussions within BMW on how it plans to come up with a gameplay to tackle the issues the stand before them.

Crucial among these issues is the design of the M2 GranCoupé’s body. Senior BMW officials are apparently torn between a traditional four-door coupe design or a more radical five-door lift back. Klaus Fröhlich, BMW’s R&D boss, is reportedly keen on taking the more traditional route of a four-door look, but it seems that there’s still a faction within BMW that is championing for a liftback version to create a unique and more practical model when compared to the four-door RS3 and AMG CLA 45.

What appears clear at this point is that the M2 GranCoupé will come with a longitudinally mounted engine and a rear-wheel drive system as opposed to the transversely mounted engines and four-wheel drive systems that are being used by its counterparts in Audi and Mercedes-Benz. BMW believes that using this format provides a more engaging drive for future owners of the model, at least compared to the RS3 and the AMG CLA 45.

The M2 GranCoupé is also expected to have a new interior layout that will serve as the basis for the facelifted versions of the 2 Series Coupe and Cabriolet. Both models are expected to make their respective debuts in 2020, so having the M2 GranCoupé be the first model to get this new interior look should help increase its appeal.

No actual numbers have been announced, but there’s growing sentiment that the M2 GranCoupé will make use of the same 3.0-liter turbocharged inline six-cylinder engine that’s expected to produce 365 horsepower. Likewise, BMW has kept mum on the performance capabilities of the M2 GranCoupé, although it’s likely that it will have similar numbers as the M2 Coupe, which carries an official 0-to-62-mph sprint time of 4.5 seconds and a top speed of 155 mph. A six-speed manual transmission will come as standard on the M2 GranCoupé with an option to get a seven-speed dual-clutch automatic transmission also in the cards.

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Why it matters

This is great news for fans of BMW and its M Performance Division, but I think there’s a legitimate question to be asked on whether BMW's adding more M models is good for the automaker in the long run. The Autocar article touched on this when it said that there’s belief within BMW that a space can be created for the M2 GranCoupé with the next-generation 3 Series expected to get bigger. That’s fine. I get it. But on the flip side, I think BMW needs to also be careful with something like another M2 model because it could saturate the market for the two models, design differences notwithstanding.

This isn’t like having an M2, M3, and M4 to choose from. Those three models clearly have differences of their own. I see a scenario wherein a customer buys two of those three models, maybe even all three. But an M2 and an M2 GranCoupé? I don’t think the differences will be that pronounced in the end to the point that customers would be willing to buy both models. In the end, having an M2 GranCoupé could affect the sales of the M2 and vice versa. That doesn’t even count how well its competitors will do with their own offerings. Is BMW willing to deal with that?

The M2 was perfect on its own because it provided those who couldn’t afford an M4 the chance to have their own M-powered vehicles. But the M2 GranCoupé? What’s going to keep these people from just getting the M2 or the M3? I know I don’t know all the answers here and BMW is smart enough to understand what it’s getting itself into. I just think that, from a purely business perspective, BMW could do something better than having an M2 GranCoupé.

It sounds great on paper, and in a perfect world, I’d be a fan of this move. But we don’t live in that kind of world and I can’t help but wonder if building another M2 variant is going to be worth BMW’s time in the long run.

BMW M2

Read our full review on the BMW M2 here.