Jaguar is the only car maker that I think could make a car better than the 3-Series. They really seem to understand that it isn't about numbers, its about how the car feels. If they put a manual transmission in it, I think BMW should be worried. They probably wont be competitive in terms of sales, but in terms of pride. Just look at the Jaguar line up right now. There is the XJ,XF, XK, and F-Type. They are all stunning cars, and have tons of character. The latter cannot be said about any current BMW.
And do people seriously not realize that the picture is a render? I don't even think a prototype has been spotted yet.