BMW has been testing the xDriveM40i M Performance model of its next-gen X3 at the Nürburgring Nordschleife circuit. The new X3 is slated for a global launch in 2017, while the hotter M model is expected to arrive later in 2018.

The X3 xDriveM40i will be powered by BMW's twin turbocharged 3.0-litre straight-six engine, which also features in the new 7-series. There’s also news of a diesel variant, which is likely to be powered by a milder version of the BMW’s 381.3hp, 3.0-litre in-line six-cylinder engine, which is used on the X5 M50d.

While there’s no information on a full-blown X3 M, there could be a 431hp X3 which uses the same turbocharged 3.0-litre in-line six-cylinder engine found in the latest M3. If put into production, the model would compete against the Porsche Macan Turbo and upcoming Mercedes-AMG GLC 63 The regular version of the new X3, internally codenamed G01, will get an upgraded cabin with a bigger, dash-top mounted, infotainment screen with the latest version of BMW’s iDrive system. The longer rear doors of the test prototype suggest a slightly longer wheelbase than the current model’s 2,810mm.

The engine line-up for the new X3 is set to include a range of updated four-cylinder and all-new six-cylinder direct-injection petrol and diesel units, while a new fuel-efficient nine-speed automatic from ZF is also likely to be offered on all the engines. A frugal X3 xDrive35e plug-in petrol hybrid, using the same driveline hardware as the 330e 3-series plug-in hybrid is also expected later in 2017.

Select models could be offered as rear-wheel-drive, however, expect four-wheel-drive xDrive models to be mainstay in the X3 range.