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Good question. As long as the 3 cylinder makes at least 200hp, I don't see why it wouldn't work for the Canadian entry level 3 series.
That said, it may not necessarily be likely. epiphone pretty muched covered all three possibilities. With the debut of the F20 1 series in just a few months (and an internet reveal sometime before that) we should know at least one more piece of the puzzle. As SCOTT says, the F20 will have an all turbocharged engine lineup. And I have to believe there will be some gasoline models available from introduction with less than the ~240hp the N20 has been seen with so far. My guess is whatever powers the next gasoline model down from the upcoming 128i (be it a 125i or perhaps a 123i) will also power the Canadian 323i.
At this point it seems like it will be a lower output N20, but there is also an "N13B16" four cylinder coming too, according to rumor. Though it remains to be seen if that will be featured only in the upcoming range of FWD 1 series models that share the next Mini platform, or if they will adopt it to the RWD 1 and/or 3 series model also.
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