I have a 323i (1997) model. Yesterday, while driving, I noticed the engine temperature needle going up into the red. Slowed down, turned off the air-conditioning and went straight to the mechanic who has, overnight, taken a look at the car. I got a call this morning to tell me that water has leaked into the engine (can that happen? And how?) and that the engine needs to be replaced. I then called up a second mechanic I know and described the symptoms. He was of the opinion that the cylinder head gaskets could have burnt out. Both jobs are really expensive (I live in Hong Kong where everything costs three times as much as anywhere else), so I am wondering if it is worth the cost to do this.
If anyone could advise me as to whether their diagnosis is correct, I'd be grateful. The symptoms are: overheating when driving (just yesterday). By the time I got to the mechanic's, the engine had smoke coming out from under the bonnet. Coolant reservoir was full and radiator was reportedly OK. Nothing else to go by. Any ideas?