BMWs may traditionally be famed for performance rather than economy, but the most frugal 1-series – the 116d ED – matches the best diesel Volkswagen Golf and Audi A3 in the economy stakes.

Thanks to a claimed figure of 83.1mpg – allied to 89g/km emissions and 16% BIK rate – the least-thirsty conventional BMW offers very little on-paper compromise to those who don’t want to sacrifice an engaging driving experience in pursuit of low tax.

Despite its meagre-sounding 1.5-litre, three-cylinder engine, the 116d ED pulls strongly from low revs and offers sharp steering and agile handling. Throw in a low-slung driving position, its long bonnet and rear-wheel drive and this 1-series retains the sporty feel of pricier BMWs.

This sporty vibe doesn’t come at the expense of refinement or comfort, though. Little vibration or noise gets through to the cabin from the engine, while the suspension provides a firm but comfortable ride. Long gearing can make pulling into tight gaps more challenging than it could be, however, and shifting too early can make progress a little slow.

But the 116d ED struggles when it comes to whole-life costs. Although it offers a competitive price tag – just below that of the Golf 1.6 TDI Bluemotion and Mercedes A180 CDI SE and just above that of the Audi A3 1.6 TDI ultra – residuals of 37.8% (compared with 41.3% for the A3) mean the BMW’s cost per mile figure of 43.7p can’t match the Audi’s 42.2p. The petrol-electric Lexus CT200h S also undercuts it at 42.6p. The 116d ED does beat the Golf by more than 2p per mile, though.

The 116d ED might not be the cheapest car in the class, but users happy to pay a little more every month shouldn’t feel short changed – especially now that BMW includes satnav as standard.