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First thing to make a good track car out of a 135i would be a LSD... Apparently even without it can be as fast as an e46 m3 from the comparisons i saw on youtube. But owning one i can say i feel the lack of lsd a lot with my worn out tires.
That been said i'm a bit afraid of reliability for the old e46. It's now getting old and god knows what the previous owners did with it. Our 135i stock run well below the components capabilities, especially for n54s, while the e46 is a highly tuned engine.
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