Some cars leap off the spec sheet like an Alonso-piloted F1 car, and the BMW 130i is most definitely one of them. There was a certain amount of derision when BMW's challengingly-styled new baby hit the showrooms in 2004; although it boasted unparalleled rear-drive dynamics it toted at best a fairly limp 161bhp. But now the promise of that unique rear-drive configuration (for a hatch), uncorrupted steering and perfect weight distribution is backed-up by a searing, sonorous 3-litre straight-six packing a silken 265bhp punch. You may not like the look of the 130i but you've got to admit it's a pretty tasty proposition.

Of course, the thumping power and beautifully detailed chassis come at a price. In SE spec the 130i will cost ΂£24,745 when it goes on sale in September. Not cheap, but a well-specced Golf GTI with 'just' 200bhp will comfortably reach similar fiscal heights, and the SE comes decently equipped.

However, BMW doesn't expect the bottom line to be a major issue for 130i buyers, and expects the M Sport version to take the lion's share of sales. With subtle aerodynamic add-ons, M Sport suspension, a short-shift gearlever and 18in alloys, the package really pumps-up the tame 1-series shape. The price of the quiet aggression and promised added control takes the 130i up to ΂£26,515. That's ΂£2310 less than a 330i, and around ΂£3K more than the anticipated price for the VW Golf R32.

I expect we've just lost a few readers, but for those of you who can countenance a near-΂£30K 1-series, read on, because they might just be missing out on one of the finest cars of the year. Why? Well, for starters it immediately feels and looks like a quality product. More so than a Golf GTI and, I'd guess, the forthcoming R32. It's quick, too. It hits its 155mph limiter just as the rev-limiter in 5th chimes in, and there's clearly plenty more to come if only the remainder of 6th wasn't off-limits. The 130i should sneak under six seconds to sixty (BMW claims 6.1sec for the 0-62mph sprint), too. Which puts it out ahead of the cheaper, even wackier Mazda RX8 and pretty close to the more powerful Nissan 350Z.

Set aside the figures for a moment and the 130i still makes a compelling case for itself, simply because of the nature of its delivery. That super-lightweight magnesium-alloy 3-litre straight-six is simply stunning. Smooth as honey but with a killer sting, it's producing its peak torque figure of 232lb ft by 2500rpm and holds it until 4000rpm. By then the power is ramping up, the complex howl filling the cabin and the 1-series reeling in the horizon at a wicked rate. Keep the throttle pinned and you're sure to hit the 7000rpm limiter until you get used to its eerie smoothness; the engine feels like it could rev to 8500rpm without complaint.

As you'd expect, the motor is the 130i's defining element, but if you're expecting a bit of a hot-rod then perhaps this isn't the car for you. I was initially disappointed that the 100bhp hike in power had been absorbed and controlled so seamlessly by the chassis. There's massive traction and, in the M Sport car particularly, the lateral grip seems limitless. Factor in a firm but supple ride and you're left with an over-riding sense of accomplishment rather than a straining-at-the-leash tearaway. BMW will thank its trick five-link rear axle and lightweight aluminium suspension components for the 130i's unfazable composure, but after a brief drive you might just wish it had dialled-out a bit of control and dialled-in a bit more throttle sensitivity.

The roads around Munich are smooth and fast, with 4th gear sweepers more common than 2nd gear twists, making it tricky to drive through the M Sport's awesome composure. The occasional ragged section hints at the car's intent, the big wheels thudding into the tarmac but staying controlled, the car morphing into a harder, more agile kind of 1-series as the tarmac becomes more challenging. Just the odd bout of wheel skip over rapid imperfections reminds you of its run-flat tyres and the weight the dampers are managing.

But find the right combination of corners and the potential in the 130i M Sport emerges. It darts into turns without a hint of understeer or hesitation, settles quickly into the heart of a corner and digs in hard when you spot the exit and pull the trigger. Get it right and you can feel the rear tyres steering the car into the corner, fighting understeer and letting your actions dictate the attitude of the car. On UK roads littered with tricky corner approaches, nasty surface changes and unpredictable cambers, I suspect the M Sport-equipped 130i will feel responsive and aggressive, and I just know it'll soak up punishment with ever-increasing relish. It feels like a car honed right to its very limits.

Should you overstep them the 130i is fitted with BMW's latest DSC software and it works well, staying unobtrusive until absolutely necessary and giving you back control as soon as the situation is contained. Hit the DTC button and the limits are pushed higher, but soon you'll feel confident to lose the stability control altogether with a longer prod on the button. The 130i doesn't have a limited-slip diff so you'll get plenty of inside rear wheelspin before opposite-lock heroics are required. Don't quote me on that in the wet, though...

Our test cars are fitted with BMW's controversial variable-rack Active Steering system. I'm not really anti-Active Steering (though many are), but I'd still stick with the standard set-up. BMW goes to great lengths to highlight the benefits of rear-drive on steering feel, so why specify a system that clearly places a filter between your fingertips and the road? A quick squirt in an SE with conventional steering showed it to be more communicative and 'natural', allowing you to flow with the car rather than react to responses that don't feel entirely intuitive.

Of course you could save a substantial ΂£1770 and forego the M Sport kit altogether. On slightly plumper 205/50 R17 tyres (the M Sport has 215/40 R18s at the front and gargantuan 235/35s out back) it certainly rides with a softer edge, and the performance is undiminished. The limits are more accessible, too, although even the SE cars on test were fitted with the 15mm lower M Sports suspension, which clouds the issue somewhat. The 130i SE is a stealthy device and wonderfully fluid, but I think you'd miss the supreme turn-in and ultimate control of the M Sport car with time.

The 130i's devastating combination of deep-seated quality, engineering integrity and the control it displays when you're tapping into the rich reserves of power make it a bit of a hero in my book. I'd love to unreservedly give it our seal of approval and nominate it for our Car of the Year bash, but unfortunately the roads around Munich weren't quite challenging enough to delve deep into the chassis' abilities. It feels agile and definitely more neutral than its less-powerful siblings, and the tantalising glimpses of how it behaves in extreme situations showed great promise.

My guess is that the 130i M Sport will be stonking when we get to drive it in the UK. And although for some people a ΂£26-grand 1-series will always be beyond the pale, for those of us who think a big-engined, light and compact rear-drive screamer is about as good as it gets, the 130i might just be the perfect tonic.