Buying Guide - Get yourself a hot-hatch bargain with Peugeot’s 106 XSi, GTi and Rallye

Buying Guide - Get yourself a hot-hatch bargain with Peugeot’s 106 XSi, GTi and Rallye

Peugeot 106 — Missed out on a 205GTi? This is just as good, so buy now before the market wakes up.


Photography MATT HOWELL

Six steps to buying a Peugeot’s 106

No car’s passing has been quite so lamented as that of the Peugeot 205GTi. Its supposedly unrepeatable combination of sharp handling, and light weight with such a feisty engine has yet to be repeated in its 206/7/8 predecessors.

Buying Guide - Get yourself a hot-hatch bargain with Peugeot’s 106 XSi, GTi and Rallye

But perhaps this misses the point? The 106, which supplemented the 205 in its last days, shares its spirit; and its sportier versions are strongly reminiscent of the older car’s Rallye and GTi variants. As 205 prices attract collectors, anyone who feels like they’ve missed out should consider a 106XSi, GTi or Rallye.

‘It’s a hot hatch, so the obvious things to be wary of are a crashed example or a track-day car’

To guide us to a good sporting 106, we spoke to Darren Spooner, who runs performance Peugeot specialist Spoox Motorsport, preparing race and rally examples as well as helping to restore road 106s to original condition.

Which one to choose?

  • Launched in 1991, the range-topping XSi followed on from the departed 205GTi 1.6. Its Bosch Motronic MP3.1-injected 1.4-litre engine made 100bhp, and was coupled with body-coloured valances, alloy wheels, stiffer suspension and a roof spoiler. The addition of a catalytic converter dropped the power to 95bhp from 1993.The lightweight homologation-special Rallye was launched in 1993, with Magneti Marelli 8P injection yielding 98bhp from a catalysed 1.3, with a dizzying 7200rpm redline. Distinguished by wheelarch extensions and white-painted steel wheels, its ultrabasic specification reduced its kerbweight to 825kg.The XSi 1.6 accompanied the 1.4 from 1994, the larger engine combining with the Rallye’s injection system to deliver 105bhp. The XSi was replaced by the new GTi as part of the Phase II facelift of 1996. Magneti Marelli 1AP fuel injection and a 16v cylinder head raised power to 118bhp – just two shy of the old 205GTi 1.9. It was discontinued in 2003.1997’s Phase II Rallye performed the same weight-reduction strategy on the facelifted car, this time with a 103bhp 1.6-litre engine. An undisclosed handful of Rallyes received the GTi’s 118bhp 16v engine towards the end of the car’s production run in 2000.


It’s a hot hatch, so the obvious things to be wary of are a crashed example or a car that may show signs of use on track days – and in motor sport. Some have found their way back on to the road, so check history carefully. With road cars, it should all be quite simple. The 106 offered robust construction for its time but age and scrappage have taken their toll. A good example is still very nice to drive. While better protected than earlier Peugeots, they still love to rust. Check the fuel tank, and inside the wheelarches, inner wings and suspension wishbone mounts. Corrosion may lurk under the extra plastic trim on the wheelarches of Rallyes and GTis.

‘It’s a popular starter classic; the oldest is now 30 years old. They’re a steal compared with the 205’

Replacement pattern wings and sills are available cheaply from the likes of Euro Car Parts – £70 for a sill section, for example. Full-body restorations are economically unviable on most examples, and only just on the best Phase I Rallyes. However, spending £4000 on a localised lower-body tidy-up can turn a 106 that’s rusty in the usual places into a nice example.

Engine and gearbox

Some parts for the unique 1.3 Rallye engine are difficult to find, such as the fuel pump and fuel sender. It’s essential to make sure the original unit hasn’t been replaced, so check if the numbers match on the engine and chassis plates. You can usually tell a Rallye engine (coded TU2J2L/Z in the Phase I and TU5J2 in the Phase II) by its Magneti Marelli 8P fuel injection system, although the engine in the Phase II is the same as an XSi 1.6’s. Check all engines for signs of thrashing and poor maintenance – such as excess, mayonnaise-like oil and water emulsion in the oil cap. Most 106s should have had at least one cylinder head gasket and cambelt replacement by now, so have a look through the paperwork for evidence. The TU-series engines are strong but check for top-end engine rattles – this will be the tappets and camshaft – oil leaks, and a smoky exhaust, all signs of neglect.

Buying Guide - Get yourself a hot-hatch bargain with Peugeot’s 106 XSi, GTi and Rallye

These were ubiquitous engines in Peugeot’s range in the Nineties and 2000s, so if rebuild costs threaten to spiral, replacing the TU5 found in most sporting 106s is easy for many mechanics and can be done for £1k-£1.5k, including a donor car. This isn’t the case for a Phase I Rallye. The 1.3-litre TU2J2L/Z engine is a bespoke creation of Peugeot Sport, an all-alloy unit with unique camshaft, ECU, cylinder head and wiring harness, none of which is readily available. If the block and head are good, rebuilding will set you back £5k if it’s done professionally, but finding a replacement for a car that’s been re-engined can cost £8000. And be prepared for trying to source one in France. You’d be unlucky to find a 106 with a tired or whining gearbox. However, sloppy changes mean worn linkages. Slipping clutches are straightforward to replace; and if you end up replacing a clutch, you’ll often need to do the release bearing and cable too. None of it is especially expensive, so the whole operation shouldn’t run to more than £600.

Suspension and brakes

Healthy 106 suspension and associated undercarriage parts are essential for Peugeot’s magic handling formula. Wheel bearings wear out and bushes on lower wishbones are prone to wear, but check all around the car for cracked or loose bushes and sagging suspension. Budget £400 for a thorough suspension refresh. Pedal feel is good in every 106 but you do have to push quite hard to get proper stopping power out of them. Brake linings are glued in place and can fall apart, locking the rear drums in the process. This will show itself up on any test-drive, so make sure you do that before making a purchase. They’re commonly-found parts so replacement brakes shouldn’t run to more than £180 per side, with the same amount to fit them.

Interior and electrics

Inside, you’ll notice some brittle plastics here and there, but the 106 is generally pretty rugged – nowhere near as flimsy as some similarly aged superminis, and a world away from the rattly 205. There are few electrical issues to worry about. The seat can wear through wiring for seatbelt pretensioners, which will throw up a dashboard warning. Replacing the relevant section of the wiring loom is the only solution, but at £80 it’s not offputtingly expensive. The only other issues seem to come up as a result of poorly fitted stereos and other aftermarket sound equipment. As with any car that’s been previously stripped out for sporting activities, make sure all the XSi, Rallye and GTi interior trim is there because some replacement parts are near-impossible to find these days. Both eBay and autojumbles – including the Peugeot-specific one held at Prescott’s annual PugFest – are your best bet, but what you’ll find is a gamble.

Some upholstery colours were wonderfully lurid but become stained easily, although a session at a detailer’s or a weekend with a carpet cleaner can return them to their former glory.

Interiors are hardwearing compared to Peugeots past Engines are tough and cheap to fix – unless it’s a Phase I Rallye like this one.

What to pay

  • If you’re lucky, you might find an XSi for as little as £1k, but they’re rare cars now and it may be in poor condition. You’re best off budgeting more like £3000 for a good one.
  • That’s also the entry point for good GTis, with the very best fetching £7000. ü You’ll pay a £1-2k premium over GTi prices for a Phase II Rallye.
  • The most sought-after of all is the Phase I Rallye, with prices starting at £6k for a runner in decent condition and the very best commanding £10k

Owning a Peugeot 106

Elliot Dunn

Elliot says he’s lucky to have his 1995 Rallye. ‘I wanted this version for my first car but couldn’t afford the insurance, so had to wait a few years. Good ones are hard to find, so be prepared to wait. When I want to reconnect and feel alive, this is the car for me. You don’t have to break the speed limit to get the biggest thrills. ‘You can still pick up standard base spec and mid-range 106s for peanuts. They respond well to modification and weight reduction even if you can’t run to a Rallye or GTi. Even decent ones hover around £1k, with the very best selling for a few thousand at most. Scruffy examples in need of work are often lucky to escape the crusher, but that doesn’t take away from their desirability among enthusiasts. This is a popular starter classic, with the oldest survivors now 30 years old. And they’re a steal compared with the 205.’

Alex Pugh

‘Back axles can be quite troublesome and costly,’ warns Alex, who owns an immaculate Phase II Rallye. ‘I changed mine for a reconditioned one, which cost £300 – but I’m a mechanic, so I didn’t have the cost of fitting it. ‘The Phase II Rallye’s eight-valve engine is more reliable than the 16v found in the 106GTi and, unlike the Phase I’s unique powerplant, parts for it are really cheap and easy to come by. The secondhand market is very helpful – not something that can be said for many classic cars.

‘It’s also a classic that’s easy to use daily if you want. But to keep it really pristine I garage mine throughout the winter months, and clean it regularly through the rest of the year.’

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