TO ANYONE who remembers the original BMW Z3 roadster of 1997, the idea of a new entry-level four-cylinder Z4 would probably be met with a groan and flashbacks to the unloved 1.9-litre four-pot that wheezed along in the base variant of what was then James Bond’s company car.

Lucky then that during the intervening years the BMW equivalent of Q-branch has been developing its TwinPower turbo technology, first applied to produce mighty eight and six-cylinder engines but finally making its way down to the more humble four.

If the brochure is to be believed, this new engine, codenamed N20, combines impressive performance with even more impressive efficiency, and the unit has also made it onto the Ward’s 10 Best Engines list for 2011.

BMW offers the N20 engine in two states of tune: the 135kW/270Nm sDrive20i, which replaces the 2.5-litre sDrive23i, and the 180kW/350Nm sDrive28i, which replaces the 3.0-litre sDrive30i.

First, let us concentrate on the 28i. How does 0-100km/h in 5.7 seconds and fuel consumption of 6.8 litres per 100 kilometres grab you? Acceleration is a tenth quicker than its 30i predecessor, while fuel consumption is down 21 per cent. Not bad going.

The 20i has the same fuel consumption as its more powerful counterpart but takes 6.9 seconds to hit 100km/h – 0.3 seconds slower than the old 23i, but this can be forgiven due to it being $9300 less expensive.

Sprint performance on the 20i drops to 7.2 seconds when fitted with the eight-speed automatic, leading us to believe the 28i is better suited to the auto, as performance on that variant is unaffected by the presence of a self-shifter.

BMW provided an example of the 28i with the automatic transmission, a manual 20i and the range-topping 35is (for comparison purposes) for a small launch event held at the Gold Coast.

First up, we took the key to $95,440 worth of 28i, optioned with the $3500 eight-speed automatic, $1840 metallic paint and $700 anti-dazzle mirrors.

Even with these options, this Z4 looked like a bit of a bargain against the $118,900 Mercedes-Benz SLK350, which accelerates to 100km/h a tenth quicker but consumes far more fuel (in fact both four-cylinder Z4s are 0.2L/100km more fuel-efficient than the entry-level SLK200).

The BMW team had thoughtfully lowered the roof of each Z4 and it was a perfect sunny morning, providing us with an opportunity to hear what had been lost in terms of aural pleasure compared with the old six-cylinder.

Before the engine had warmed up it sounded disappointingly diesel-like, but as the oil temperature gauge rose and the roads got faster, we were pleased to hear an entertaining howl from the double-barrel exhaust pipes, with a bit of four-cylinder resonance thrown in for good measure.

Like the 1.4-litre MultiAir engine of the Alfa Romeo Giulietta, the turbo can be heard huffing and chuffing, with a blow-off hiss when releasing the throttle.

Pushing the Z4 hard on challenging sections of road, this pleasing sound was often heard as a tell-tale sign that the safety electronics were automatically backing off the throttle to maintain traction.

Working the engine to its 7000rpm redline on narrow, twisting cliff-side roads gave us plenty of opportunity to hear the engine at work as sounds were reflected.

This is no zingy, rasping six-pot of old, but a good effort for a four-cylinder blowing its gases through a turbocharger.

Back to the present and the high-output N20 has a distinctly grunty feel and is always on hand to provide a shove in the back thanks to maximum torque being available from just 1250rpm, meaning at everyday speeds the 28i felt more instantly responsive than the blistering 250kW/450Nm 35is.

We have no complaints about refinement or smoothness, nor could we detect turbo lag in any circumstance, be it taking off from traffic lights or when reapplying the throttle to accelerate through a bend.

The N20’s flexibility enabled us to drive it like a diesel round town, enjoy its mid-range punch for confident overtaking and explore the upper echelons of the rev range on mountainous roads.

Try that with the old six-pot, which was happiest with the needle north of 5000rpm – this new engine really is a bit of a masterpiece.

A bit less weight at the front end of the Z4 makes it more eager to change direction, and turn-in is crisp, provided Sport mode is selected using the switch on the centre console.

Sport mode also sharpens the Z4’s responses to throttle inputs and transforms the ZF eight-speed unit from cruiser to bruiser, delivering fast, aggressive gear changes – and exhaust rasp between full-throttle cog-swaps – that would give some dual-clutch units a run for their money.

By contrast the default Comfort mode seems to introduce steering play either side of the straight-ahead and a woolly wheel-feel. Perhaps this turgid and tedious mode is aimed at distracted commuters who want to avoid drifting between lanes while they comb their hair on the way to work.

Despite being a low-slung sports car riding on run-flat tyres, we found the 28i’s ride to be compliant and comfortable. It dealt well with mid-corner bumps, remaining composed over some shocking patch-work surfaces encountered when we crossed the border into New South Wales.

During our thrash through the hills in the Tweed River area inland from the Gold Coast, the 28i averaged fuel consumption of 10.2L/100km – not bad considering the old 30i’s quoted figure was 8.5L/100km and would have been far higher if driven in the same way.

Next we tried the base 20i, priced from $78,900 – $6000 less than the SLK 200 – fitted with the $4900 M Sport package, $1330 sports seats and $700 self-dimming mirrors.

We were not instantly enamoured by the slightly rubbery shift feel of the six-speed manual transmission, which after the eight-speed automatic seemed to have the ratio spacing all wrong – and the cheap, hard-feeling M Sport gear knob did not help its cause.

Compared with the 28i, the lower-powered N20 of the 20i seemed to have a more muted exhaust note, and its characteristics were largely the same as the harder-charging version, just with less available thrust.

Apart from ruining the ride, the M Sport package, with its ‘sports’ suspension and 18-inch alloy wheels, also made the Z4 feel less planted and composed over rougher sections of road, but more interactive in that it was more willing to slew around with little provocation.

We found the optional sports seats to be uncomfortable, with all the thigh support of a bar stool but far more side support than the standard chairs, which are more comfortable but ridiculously flat for a sports car.

Although we expected the 20i to be thirstier than the 28i given it has to be worked harder to maintain pace, we were pleasantly surprised to find it had returned average fuel consumption of 8.5L/100km.

If the Z4’s frugal new engine and lower pricing is tempting you, consider this before opting for the cheaper 20i: although the 28i costs a hefty $12,500 more than the base model, it comes with a generous amount of extra equipment that would cost $10,600 if selected from the options list.

The extra kit includes satellite-navigation ($4500), an upgraded 11-speaker sound-system ($1500), voice control ($700), electric seat adjustment ($2500), an interior ambient lighting package ($500) and turbine-style 17-inch alloy wheels ($900).

That value-for-money consideration, fruitier exhaust note and the fact the 28i provides all the performance necessary for having a blast on public roads leads us to conclude it is pick of the Z4 line-up, even against the ballistic pair of turbocharged six-cylinder range-toppers.

One drive in the 28i will erase all bad memories of that sluggish four-cylinder Z3. Q-branch would have been proud of such an achievement, so it is a shame for BMW that 007 has a preference for Aston Martin these days.