THE exciting new BMW M2 is the latest in an illustrious line of compact high-performance saloons that began with the 2002 nearly four decades ago.

Powered by a specially developed 3.0-litre straight six (the layout used in all the best BMWs), the M2 certainly lives up to the famous badge thanks to a 370bhp kick in the pants.

The top speed is 'limited' to 155mph and along the way it will hit 62mph in just 4.3 seconds.

Peak power is at 6,500rpm but the engine revs on to 7,000rpm, while peak torque (a hefty 500Nm) is on tap across an unusually broad spread between 1,400 and 5,560rpm. An overboost function raises this figure by 35Nm to 500 Nm between 1,450 and 4,750rpm. Despite this potent performance, the combined fuel consumption is 33.2mpg when fitted with a six-speed manual gearbox, and 35.8mpg with the optional M-DCT automatic. The CO2 emissions are 199g/km and 185g/km respectively.

BMW's engineers have extracted this giant-killing performance thanks to a TwinScroll turbocharger, High Precision Injection, variable camshaft timing (Double-VANOS) and VALVETRONIC variable valve control.

The M2’s turbocharger has been integrated into the exhaust manifold, reducing the warm-up phase after a cold start and thereby helping to cut internal friction and significantly reduce fuel consumption and CO2 emissions.

Components including the pistons were sourced from the BMW M3/M4 engine, as are the crankshaft main bearing shells.

In order to ensure oil reaches all engine components at all times under the kind of extreme conditions encountered on a race track, the engine benefits from a modified lubrication system; an additional oil cooler for the transmission oil (on M-DCT models) and a further water cooler for the engine keep temperatures stable.

The standard fit six-speed manual gearbox, features dry-sump lubrication and an engagement speed control function which blips the throttle on downshifts and lowers the engine’s revs on upshifts.

The aluminium suspension borrows heavily from the larger M3/M4 models and bespoke tyres, together with lightweight 19-inch forged wheels, substantially reduce rotating and unsprung mass.

High performance brakes (four piston fronts and twin piston pots on the rear) and an Active M diff complete the impressive picture.

Characteristic M design elements define the front end and the large front apron with trapezoidal blades and the outer air intakes were inspired by the iconic BMW 3.0 CSL touring car racer.

Thanks to the careful channelling of the airflow around and through elements of the car, drag has been reduced by five per cent compared with the BMW 2 Series Coupé, despite the M2’s stronger cooling performance. The aerodynamic measures have also reduced lift by 35 per cent and significantly improved aerodynamic balance at higher speeds.

Viewed from the side, the compact dimensions and hallmark BMW proportions with classic BMW Hofmeister kink give the M2 an unmistakable profile. Sculptural wing extensions at the front and rear axle (front: 55mm, rear: 80mm) are not only a neat design trick, but also help accommodate the wider track and wheels.

All in all it's a worthy addition to the legendary M-Sport stable but there are a couple of snags - the M2 won't go on sale in the UK until next April and when it does the price will be an eye-watering £44,070.