It may come as no surprise that BMW is looking to expand diesel offerings in the US. Diesel power is a practical and efficient way of achieving both better emissions and higher fuel economy. We had reported for sometime that the X1 would usher the four-cylinder era once again on US soil, in both petrol and diesel forms (some of the engine displays at NYIAS even had X1 on them but of course the 4 cylinder launched in the Z4 as the X1 was delayed). With the X1 placed in an indefinite holding pattern (more on that shortly) for its landing stateside focus has moved to injecting some diesel grunt into the X3.

Our sources, including Herr26/Scott27, have indicated that the X3 will fill the diesel void in 2012 as the E90 335d will be retired this fall, leaving the aging X5 xDrive 35d as they only diesel BMW offers on American shores. The X3 would fill the void for customers looking for a diesel powered SAV that do not want to purchase an end of life offering or feel that the X5 is just too much for their needs.

Much like the current X5, the diesel engine will be built in Germany and shipped to the US where installed in a just-in-time model during final vehicle assembly. Sources indicate that the current diesel engine, the 35d, will continue on for sometime as BMWNA hopes to recoup the engineering and overall costs of federalization- but the introduction of a second smaller diesel has been given the go ahead for when the X1 does makes its arrival.

As we mentioned yesterday the X1 is officially delayed indefinitely in the US. However that doesn ‘t mean BMW isn ‘t still planning a release of the car in the US market. As indicated in our story yesterday, it would make a lot of sense for BMW to bring the X1 to the US on conjunction with it ‘s LCI of mid life-cycle refresh in 2013. And even BMW has mentioned that the X1 (when it does make it to the US) will be powered by the N20 four cylinderin the Z4 28i and the 528i. However 2013 would be an ideal time to bring an even more (much more) efficient diesel to the US in the form of an upgraded 2.0L four cylinder. One could imagine the engine ultimately slotting into the 3 series as well.