This version of the X1 is being developed (and close to being finished) due to the existence of performance-oriented small crossovers in the Audi and Mercedes-AMG portfolios. Some of those rivals existed before the X1 M35i or M40i was a thing, but it seems that BMW has decided to play ball with its traditional competitors in this segment as well.
While the X1’s performance-focused version will not be a true M car, nor will it be badged as an X1 M, it will come with things that would normally be found on M cars, such as the quad exhaust tips.
As everyone knew back in their childhood, a car with four exhaust tips has more power than one with two, and BMW is using this logic to the max, as it will be deployed on the X2 as well, along with the updated 1 Series's M35i version. The latter will come with 306 horsepower, and the same should apply to the X1's hot version, unless BMW M has something to do with it.
The prototype sports bigger air intakes in the front, visibly larger brakes than the regular X1, as well as a stiffer suspension. The trunk lid has a spoiler that was neatly integrated. On the inside, a sportier steering wheel design can be observed, while the seats also look a bit sportier.
BMW fans might argue that this version would have been a lot more fun with the first-gen X1, the E84, which had a longitudinally mounted engine. It could have easily been a sporty crossover, but BMW did not think the market was there for it at the time. In the meantime, BMW has changed its mind.