SMG-II

The Sequential Manual Gearbox, aka Sequential M Gearbox ( since, for now, the only US BMW to have SMG-II is the E46 M3 ). It's not an automatic, and its not a manual. It's a sort of mix between the two. There's no torque convertor ( like a manual ), yet the driver can opt to have the onboard computers change gears for him ( like an automatic ). Oh, and there's no need for a clutch -- SMG-II does it all itself via hydraulics.

OK. So picture a manual, but without a clutch pedal. Instead of the conventional H-pattern, SMG-II gives drivers something different. Drivers can still opt to row their own gears ( hitting the rev limiter just like a normal manual ), but changing gears happens in the blink of an eye by pulling back or forward on the "shifter". 80milliseconds. No human could possibly change that fast. Oh, and if you have to downshift, you'll even get a little throttle blip as SMG-II matches revs. Heel-toe driving gone, perfect shifts every time.

M3 SMG-II shifter	M3 SMG-II: Paddles

M3 Shifter and Paddles	Euro 3-Series SMG-II

BMW North America plans to offer SMG on at least the new 3-series, Z4, and, of course, the M3 models. The SMG used in the non-M flavors will be different than the M-flavored one.

For more info:

BMW World's review: http://www.bmwworld.com/models/config/m3_smg.htm
BMW World's 2002 cars review (check the bottom of the page for the bad news): http://www.bmwworld.com/models/years/2002/index.htm