The BMW X3 is a compact crossover SUV produced by the German automaker BMW. The X3 was the second vehicle to be classified by BMW as a Sports Activity Vehicle . It is based on the BMW 3-Series E46 automobile platform. The BMW X3 was initially criticized for its harsh ride, and minimalist interior that relied heavily on obviously plastic components, and limited off-road usage, through its heavily road-biased chassis set-up. It was also felt the car was overpriced; a basic 2.5i, which lacked cruise control or automatic headlights and had vinyl upholstery, exceeded £18,000. BMW sought to rectify these complaints in 2005, with various upgrades . The BMW X3 also disappointed some BMW purists by not being assembled at a BMW factory; instead, the car's production was outsourced to Magna Steyr, based in Graz, Austria. However, Magna Steyr has won numerous awards for quality and has been the highest rated car assembly factory in Europe. The press has provided mixed views of the BMW X3. It has bee also criticized it for its harsh ride, and pointed to the poor off-road ability.The motoring press generally liked xDrive capability, safe bottom for rough terrain and hill-descent control, but pointed to only real down side against typical off-road cars: missing gear reduction which allows to drive very slow on rough terrain without using clutch (on manual gearbox) or warming up gearbox. The car-like handling, economical entry-level diesels and BMW-typical range of options allowed the BMW X3 to establish itself in the rapidly expanding market for small-medium sized SUV's to the extent that it was market leader in Germany for 3 years, outselling even cheaper models such as the Toyota RAV4.