The vehicle comes with an 8speed automatic and a diesel is available but not in the US market yet. The diesel model is the Xdrive20d which is a 4 cylinder diesel, specs: Displacement: 1,995 cc, power output: 135 kW/184 bhp at 4,000 rpm, max. torque: 380 Nm at 1,750 – 2,750 rpm.
With a curb weight around ~4000 pounds, the X3 is one of the lightest SUV's on the market. We would argue the X3 would serve as a better base for an M suv than the X5 or X6 even. Unfortunately, it seems BMW will not be giving this model a V8.
Press Release from BMW: New X3