BMW is already working on a new generation 1-Series that will be launched sometime in 2009-2010.

The basic architecture will be carried over on the new 1-series, but there will be more aluminium used in the construction, a suite of revised engines (thought to be the 1.4 and 1.6 four-cylinder motors made in Hams Hall and already seen in various Minis and PSA group products) and, possibly, four-wheel drive.

The reason why BMW has chosen the 4WD system is the launch of the new X1 – a junior SUV to slot right at the bottom of the BM ladder. Plus it has historically always sold 'x'-badged models in mountainous regions like the Alps, where buyers often rule out anything without four-wheel drive.