Thx Al for the feedback. Sounds like I have some work ahead of me. Unfortumately, my novice hands will no be able to spare me some bucks! What can I do for a quick fix till I get around to accumulating some funds? I love the 320i, will do anything to keep her up and in good form but I am considering adding an e30...325i to my stash . I plan on keeping my 320i till one of use die!
As a matter of fact I had scheduled a complete overhaul at 300000km till my she started coughing out smoke. Also I prefer keeping my car stock and I will definitely be updating to the 2.0L. However, can i pull this true, till 300000km?

Thx for any feedbacks

Klaus, your options for overhauls are truly endless. You can go from mild to wild, or anything in between. Reminds me of the addage "speed costs money, how fast do you want to go?". The cost also depends on how much of the work you can do yourself. If you pull the engine yourself, you can save money. You can someties get away with a straight ring job, but it is recomended to at least do timing chain, rings, bearings, oil pump, the whole nine yards. Also make sure to have your head inspected. It probably needs valve guides, and seals at a minimum. A couple of other options you have are used motors, and hi compression, high performance motors with cams, headwork, trick valve jobs etc. A good used motor can be had for as little as a couple hundred bucks. A full tilt hi-po motor can set you back several thousand. I would estimate that for a GOOD stock rebuild you will spend at least $2000. Thats if you just drop amotor off at the machine shop, and say "fix it". What it all comes down to is how long you want to keep the car, and how much $ you want to invest in it. Your car is an 81 with a 1.8L. This may be a good time to get a 77-79 2.0L built. You can buy a used one of these, or you can buy a used core, and have it rebuilt. You will enjoy the extra performance from the 2.0L. I can't cover everything here, but if you have anymore questions, please feel free to post here, or email me direct. I am more than happy to help.
HTH, Al

Thanks Al for your feedback. Just another question I have. What is the approximate cost for overhauls? What are my options? New engine, etc, etc
Klaus

266 000 is about right! You are coming due for a ring job. In plain english....overhaul time. Sorry for the bad news, but thats the way it is. Al

When I accelerate in first gear, usually from a stop, blue smoke comes out of the exhaust. No snoke during normal driving...40km/hr and up.. May be a dumb question but not very familiar with cars either.
What kind of service is due? I have about 266,000km on the odometer and I doubt any work has been done on the engine. Thanks in advance for any feedback.