The E36 Compact was very popular in its home market in Europe, which prompted BMW to market the car to North America for the 1995 model year. The E36 Compact's front-engine, rear-wheel drive layout was unique for the segment, giving it no direct competitors in North America.
When introduced in the United States and Canada, despite being reasonably priced, starting at $19,900 (USD), the 318ti never enjoyed popularity in North America. While consumers desired a less expensive BMW, North American consumers, America in particular, dislike the hatchback bodystyle. Also the popularity of sport utility vehicles at the time overshadowed the compact BMW.
BMW ceased importation of the BMW Compact to North America after the 1999 model year after a very short 4 year run due to a combination of poor sales, and BMW's desire to reposition themselves more upmarket by phasing out all 4-cylinder vehicles with the introduction of the new BMW E46 3-series. The failure of the E36 Compact precluded the E46 Compact's entry into the North American market.
The failure of the E36 BMW Compact in North America also prompted BMW to reconfigure the BMW Compact's ultimate successor, the BMW 1 Series, from a hatchback to a coupe before attempting to market the car in North America again.