Peugeot 205, 106 and 306 Rallyes: the perfect formula

By Aaron McKay

| 14 Jun 2023

Classic & Sports Car – Peugeot 205, 106 and 306 Rallyes: the perfect formula

In the heady days of flying gravel and bursts of water framing your everyday hatchback as something only a few steps away from popping champagne corks at the end of a special stage, there were those who were eager to get even closer to the action than the usual GTIs could land them.

With the 1988 205 Rallye, Peugeot made that a lot easier than might have been expected, both on and off the road.

Soon surpassing the 5000 cars needed for homologation, it inspired two successors – the 106 and 306 Rallyes – and perhaps even sketched the outlines of later, more hardcore offshoots of mainstream hot hatches.

Introduced in 1988, the Peugeot 205 Rallye gave hot-hatch enthusiasts an affordable taste of rally-stage thrills

This was a time before the Subaru Impreza WRX democratised the turbocharged, four-wheel-drive pinnacle of the World Rally Championship.

Unless you were lucky enough to have a spare £40k to spend on a Peugeot 205 T16 in 1984, you had to look further down the classes.

Thus the 1294cc 205 Rallye, even cheaper than a GTI, was an immediate hit with more budget-conscious enthusiasts on and off the stages.

A lighter engine gives the 205 Rallye a more neutral balance than the tail-happy GTIs, making it feel even more agile on a cross-country run

Privateers scooped them up for competition in the sub-1300cc classes of Group A and N rallying, while its cunning Ffr69,800 (around £9300) price point, some Ffr16,000 less than a 1.6 GTI, appealed to thousands of roadgoing buyers.

The immediate popularity of this new model was proof that the motorsport campaign of the newly formed Peugeot Talbot Sport had been a great success.

In the wake of the Talbot Sunbeam Lotus, Talbot Samba Rallye and Group B monster 205 T16, as well as Paris-Dakar Rally and Pikes Peak International Hill Climb wins, the 205 Rallye was a hot product of the marketing and engineering achievements that PTS had earned by 1988.

It’s increasingly rare to find a spartan Peugeot 205 Rallye interior with unworn fabric

Finished in white, with plastic wheelarch extensions and Peugeot Talbot Sport red/yellow/blue stripes front and rear, it had the authentic look of a rally car ready to be plastered in sponsorship stickers.

It had the performance, too. Under the bonnet was the little TU24 ‘suitcase’ engine, an eight-valve ‘four’ that could summon 102bhp at 6800rpm thanks to its hot camshaft, twin Weber carburettors and bespoke manifolds – competition cars found even more.

Stripped of soundproofing and superfluous equipment such as electric windows, the production Rallye weighed 60kg less than the 1.6 GTI, leading to a marginally better power-to-weight ratio despite an 18bhp deficit.

The 205 Rallye’s iconic stripes conjure images of Peugeot Talbot Sport’s 1980s success

Borrowing its bigger brother’s suspension and brakes, but sitting on 20mm-narrower 165mm tyres and 13in wheels meant that this was an especially lively addition to the range.

Except, that is, if you lived in Germany or Switzerland, where the Rallye was only allowed through strict emissions tests in 1990 as a restyled 1.9-litre GTI.

More power, but also more weight.

Things were arguably worse in the UK, where it lost its distinctive flared wheelarches and reverted closer to a run-of-the-mill 205, with a 75bhp, 1360cc single-carb version of the TU engine from the XS.

British buyers missed out on the potent twin-carb ‘four’ as found in this example

This 1990 example is a full (low) fat version, however.

Originally sold in Spain, it is as the Rallye was envisaged – and even benefits from a Group N-spec exhaust manifold.

“I like cars that give you that last little bit from motorsport,” says its owner, who would prefer to remain nameless but whose garage includes a Porsche 911 Carrera 3.2 CS and a McLaren 600LT.

You might think the 205 is the junior by default in that sort of company, but for raw thrills the little Pug operates on its own special level.

The Peugeot 205 Rallye’s taut shape was designed in-house

“The feedback is like nothing else,” he says. “Plus you can position it on the road, and you always have options.”

The whole car fizzes with intent, even at a standstill.

Fortunately, this restored example is in such fine condition that the raucous noises are almost exclusively from the engine, rather than the 205’s notoriously rattle-prone interior.

It bursts forward, casting an immediate spell of mischief upon the driver, who just can’t resist feeding the growling tones of the twin Webers demanding full throttle.

The 205 Rallye’s bespoke font is instantly recognisable

At lower revs it’s easy to overwhelm them, however, and to avoid a flooding hesitancy you have to lean gradually into the right pedal before the high-lift cam lights up.

Above 4000rpm, the Rallye adopts a frenetic urgency for the redline that seems to hardly be tamed by each successive gear.

Suddenly it’s hurtling so excitedly towards a corner that you worry that its rather skittish feeling over bumps at speed will equate to a tricky balance into the apex.

But the sharp brakes and unassisted steering, busy with response, make it devilishly easy to pitch in and scurry out with another onslaught of roaring, rally-bred power.

The Peugeot 106 Rallye (closest) was an instant hit in the UK

Faster and faster goes the 205 Rallye and it takes a while for your thoughts to catch up after stepping out from a hard drive, and for the childish grin to fade.

Perhaps Peugeot got wind of just how much fun British buyers were having with their 205 GTIs, and even the few pukka Rallyes that were trickling across the Channel by way of determined connoisseurs.

Either way, if anyone at Sochaux had their doubts about the allocation of 1000 right-hand-drive 106 Rallyes to the UK, they would have been quickly silenced by the full order books coming back from British dealers.

The homologation purpose of the 205 Rallye (closest) was lost for later versions, but the sense of focus remained

The imports continued, too, and in total well over 16,000 were built in a production run of barely two years.

The new car, in essence, appeared hardly new at all.

Apart from a bit of nip-and-tuck to follow the laws of 1990s modernisation – the 106 now had a drag coefficient of 0.31Cd and a neat new interior – it felt almost in the realm of a three-door 205 facelift.

But Peugeot was keen to point out the all-new chassis and, while the 1294cc competition-sourced ‘four’ returned to power the Rallye, it was heavily reworked.

Although the 1.3-litre ‘four’ from the 205 Rallye remained, a raft of mechanical upgrades kept the 106 Rallye fresh

There was now fuel injection, new manifolds, a cylinder head borrowed from the 1.4-litre 106 XSi, and a higher 10.2:1 compression ratio.

It also pinched the XSi’s suspension, albeit uprated with larger-diameter anti-roll bars and stronger front mountings.

The 1.3-litre Rallye remained the most potent model in the 106 range until the arrival of the Phase 2 GTI of ’96, and a 1.6-litre Rallye derivative two years later.

Phase 1 Peugeot 106 Rallyes got a slatted grille, while Phase 2 models have a rounded nose and 1.6-litre power

Its popularity as an affordable privateer’s rally car continued, as did its place in the eyes of enthusiasts for lively hatchbacks.

Mikael Caille found this black ’95 example in 2014 to replace his Talbot Samba: “I was looking for something more, either a Renault Clio 16v or a 106 Rallye.”

Originally supplied to Italy, the car had found its way to Marbella, Spain, when Mikael discovered it.

“From the little I know, it had been used as a recce car for rallies and maybe hillclimbs,” he says.

Diminutive dimensions give the Peugeot 106 Rallye a cheeky look, but it’s actually heavier than the 205 and feels more solid, too

“My father has one as well, and he races his,” he explains.

The car followed Mikael back to his home town of Tours, France, and then to the UK in 2020.

There’s that same sense of tinny vulnerability as its predecessor inside the 106, and the same bright-red carpets.

The door still shuts with a thin-gauge hollowness that only carries around the cabin because there’s so little sound insulation.

More simple door trims were part of the 106 Rallye’s weight-saving measures

The seats are slightly firmer and less aggressively bolstered, but you sit a touch lower behind a simpler dashboard.

It fires with fuel-injected immediacy, and settles neatly to idle.

The same abrupt clutch almost catches you off-guard as the smooth throttle response brings a marked contrast to the 205’s warbly, finicky Webers.

While still feeling direct, light and responsive, the 106 trades an unapologetically frenetic attitude for an athletic one, riding more softly and managing to tune out the harsher tones of the buzzy, rally-bred 1294cc ‘four’ up front.

Like its forebears, the Peugeot 306 Rallye comes to life on a country road

With very similar gearing to its ancestor, the 106 has the same sort of rabid, high-lift-cam acceleration that is made all the more exciting in a pointy little hatchback with a very short wheelbase.

The supple suspension might have taken away a racing edge, but instead it offers encouragement to really throw it along pockmarked and cragged road surfaces with hilarious abandon.

There’s also a notable and surprising feeling of solidity with the 106, which betrays the fact that Peugeot had built a car that was smaller but heavier than the 205.

The 306 Rallye’s 2-litre engine is shared with the Peugeot GTI-6

At about the same time as the last 205s were rolling off the line, in 1994 the S16 version of the much larger 306 arrived (later badged GTI in the UK).

This new hot-hatch flagship was an immediate hit and, just as the market was narrowing in the face of soaring insurance premiums, compromising safety requirements and an endless pursuit of isolating the driver from the road – ideally with some all-terrain tyres and several inches of ground clearance – Peugeot UK decided to file down the 306 GTI into a stripped-back Rallye version to fit neatly into a small, enthusiast-populated niche.

Just 500 306 Rallyes were made, and the changes were few.

Steelies were swapped for Cyclone alloys on the Peugeot 306 Rallye

Apart from a weight-saving regime – removing the air conditioning, electric windows, 60:40 split rear seats and some sound deadening, for a total of 65kg – a standard GTI-6 remained underneath.

That meant the ubiquitous XU engine in 2-litre, 16-valve form making a healthy 167bhp; the later six-speed gearbox; and Peugeot’s trick passive-steer rear axle, the latter playing a big part in making this arguably the finest-handling hatchback of its time.

It would prove itself on the rally stages, although not as a full participant in the WRC, as the wild 306 Maxi.

The 306 Rallye’s dark interior is less inspiring than its predecessors’

Sadly, there was no meaningful roadgoing relation to the Maxi, but the Rallye was still a lively option for the enthusiast, with the usual PTS colour options and for a considerable £2695 lower list price than a standard GTI.

This red 306 Rallye was Tom Collins’ daily driver when he bought it in 2018, but it has graduated to cherished status – a fate now dawning on the other 89 examples remaining on UK roads (compared with around 40 205 Rallyes and more than 100 106s).

“I learned to drive in a 306, and this is our fifth one – after a bit of a break due to a growing family,” says Tom.

‘This is clearly a larger car with a role beyond simply firing a Peugeot badge as fast as possible along a challenging route’

“When we decided we needed a second car, this was the ultimate way back into Peugeot ownership,” he says.

For Tom, the joy of the 306 is that it has proved just as effective at shows and on Sunday drives as late-for-work commutes.

From the taller driving position to the way the 306 Rallye deftly, but detectably, manages its weight down a twisting, bumpy road, this is clearly a larger car with a role beyond simply firing a Peugeot badge as fast as possible along a challenging route.

Minimalist badging on the Peugeot 306 Rallye

Its rolling refinement is well above the others, there are decent rear seats and, relatively speaking, long-striding gear ratios.

But while it doesn’t buzz, it does growl, and surges forward on a keen thrust of mid-range torque.

It also displays a delicate, very front-drive, nose-pinned balance that, even more than its predecessors, is happy to tail-wag its way around corners with rally-style theatricals.

There’s a spirit in here of the early cars that we’re 65kg closer to reaching, but you can’t help but feel that another 65kg really would bring this Rallye to life.

Fewer than 100 Peugeot 306 Rallyes remain on UK roads

Others would take up that baton, though, such as Renault’s ultimate niche-market filler, the Clio 182 Trophy.

It’s a shame Peugeot faded into the mists of hot-hatch time so soon after the 306 Rallye, leaving it as a sort of date stamp of legends past.

Here also was the end of the special-stage sellers, an era when hot hatches proved their mettle, earned their reputations and wore their war stripes with pride.

Images: Luc Lacey

Thanks to: Peugeot Sport Club UK

Factfiles

Peugeot 205 Rallye

Sold/number built 1988-’92/30,111
Construction steel monocoque
Engine all-alloy, sohc, 8v 1294cc ‘four’, twin Weber carburettors
Max power 102bhp @ 6800rpm
Max torque 89lb ft @ 5000rpm
Transmission five-speed manual, FWD
Suspension: front independent, by MacPherson struts rear beam axle, trailing arms, torsion bars, telescopic dampers; anti-roll bar f/r
Steering rack and pinion
Brakes discs front, drums rear, with servo
Length 12ft 1⅞in (3705mm)
Width 5ft 1⅞in (1572mm)
Height 4ft 5½in (1360mm)
Wheelbase 7ft 11¼in (2420mm)
Weight 1742lb (790kg)
Mpg 35
0-60mph 9.6 secs
Top speed 118mph
Price new Ffr69,800 (£9367)
Price now £10-20,000*

Peugeot 106 Rallye

Sold/number built 1993-’98/16,500 (c1000 UK cars)
Construction steel monocoque
Engine all-alloy, sohc, 8v 1294cc ‘four’, electronic fuel injection
Max power 100bhp @ 7200rpm
Max torque 81lb ft @ 5400rpm
Transmission five-speed manual, FWD
Suspension: front independent, by MacPherson struts rear beam axle, trailing arms, torsion bars, telescopic dampers; anti-roll bar f/r
Steering rack and pinion
Brakes discs front, drums rear, with servo and anti-lock
Length 11ft 8¼in (3564mm)
Width 5ft 3¼in (1605mm)
Height 4ft 4⅜in (1330mm)
Wheelbase 7ft 9⅞in (2385mm)
Weight 1786lb (810kg)
Mpg 35
0-60mph 10.6 secs
Top speed 116mph
Price new £8995
Price now £5-10,000*

Peugeot 306 Rallye

Sold/number built 1998-’99/500
Construction steel monocoque
Engine iron-block, alloy-head, dohc, 16v 1998cc ‘four’, electronic fuel injection
Max power 167bhp @ 6500rpm
Max torque 145lb ft @ 5500rpm
Transmission six-speed manual, FWD
Suspension: front independent, by MacPherson struts rear beam axle, trailing arms, torsion bars, telescopic dampers; anti-roll bar f/r
Steering rack and pinion
Brakes discs, with servo and optional anti-lock
Length 13ft 2⅝in (4030mm)
Width 5ft 6⅝in (1692mm)
Height 4ft 6¼in (1380mm)
Wheelbase 8ft 5½in (2580mm)
Weight 2564lb (1163kg)
Mpg 30
0-60mph 7.8 secs
Top speed 130mph
Price new £15,995
Price now £5-10,000*