Life's never been better if you're lucky enough to be in the market for a £30k coupe. Alfa started the ball rolling with the sexy new Brera, Audi followed on with the second generation of its iconic TT, and now BMW is in on the act with its new Z4 Coupe.

Normally, manufacturers will launch a coupe version and then follow on with a drop-top, but the fixed-roof Z4 comes three years behind its fabric-roofed sibling, despite both being designed together in the late 1990s. The pace of new model development at BMW in recent years has meant the coupe didn't get sign-off until 2005.

BMW's keeping it simple, at least at launch, with just three variants across two engines. We've driven the lower powered of the two engines, though it's all relative when lower powered means a 265PS 3.0-litre, already used in a range of BMW products. It's joined in the line-up by the Z4 M Coupe, which nicks the current M3's 343PS 3.2-litre engine for a price tag of £41,285. But that will only be a small seller, even for the Z4 Coupe's modest volume targets, so we concentrated on the 3.0-litre.

That doesn't stop it being a cosy fit inside, though not offensively so. The way the roofline drops away behind you means you can't see more than a few metres back in the rear view mirror. But that almost doesn't matter because when a car's this quick you'll need to be looking forwards.

The driving position is perfect - you sit low in the plush cockpit while being held nicely in place by the M Sport seats that are standard on the Sport trim, the higher of the two trims available for the 3.0-litre car - and the precise steering is perfectly aligned to the coupe's sporting nature. The only worry is the harsh ride that could prove grating on more mundane motorway journeys than the quiet Scottish roads we drove on.

Rear space is adequate with the 340 litres capable of carrying enough kit for a week away, though it's less on the M version because the quad pipes mean the rear-mounted battery has to intrude into the load bay.

BMW seems to be onto a winner on the costs front, soundly beating the new Alfa and Audi arrivals thanks in no small part to the Z4 soundly, and maybe surprisingly, thrashing the Audi TT for residual values - but that may be down to BMW's comparatively low volume aspirations. It's worth noting, however, that the TT and the Brera offer token rear seats that the Z4 and Nissan's excellent 350Z, another rival, do not.

The 350Z beats the lot for costs though, and is something of a performance bargain. But the Z4 Coupe is an engaging, enticing proposition that is rewarding to drive, has the all-important prestige badge and will be slightly easier to live with on a daily basis. That's why it's our choice.

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