* New BMW 3-series sedan to go up against Tesla Model 3
* Mercedes GLE aims to take the SUV to the next level
* Peugeot e-Legend concept shows how far industry has to go
By Joseph White
PARIS, Oct 1 (Reuters) - Three new vehicles debuting at the Paris car show this week will show investors and consumers the challenges facing the global auto industry as it grapples with the biggest technological changes in a century.
A new BMW 3-series sedan, the latest in a line of cars that defined the concept of a premium sports sedan, will aim to reinvigorate a range that has ceded ground to SUVs and electric drives, while the Mercedes GLE marks an attempt to take an SUV to a new level, with some autonomous driving features.
And the Peugeot e-Legend concept stands for what automakers need to do next, and fast: design electrified vehicles that are both appealing and profitable.
The new generation BMW 3-series sedan will immediately fight for attention with a different car bearing the "3" designation - Tesla Inc's electric Model 3.
Tesla's Model 3 is now out-selling the BMW model in the United States, although the BMW 3 remains the bigger seller by far worldwide.
Tesla's all-electric car challenges BMW and other traditional premium brands for technological leadership with software that can be constantly upgraded to improve the car's performance and driver experience, and to add features.
The new BMW 3-series will also fight for attention in Paris - as in the marketplace - with the worldwide shift to SUVs. That phenomenon will be represented by the new generation of the Mercedes GLE sport utility, among other models.
The new GLE, which goes on sale next year, will come with a new, 48-volt electronic suspension system that can vary the shock absorbing function at each wheel, individually. Inside the cabin, drivers and passengers can view information on two 12.3- inch screens.
The GLE also takes another step toward automating the process of driving, with a system that can steer and vary the speed of the car within a marked lane up to 37 miles per hour. The GLE can effectively pilot itself in rush hour traffic jams.
Mercedes will offer in the GLE a 48-volt electrical system that gives the vehicle an electric boost away from stops. That offers a modest reduction in fuel consumption at a time when regulators worldwide want automakers to eliminate their oil-burning, internal combustion technology and go all-electric.
The GLE highlights the auto industry's conflicted response to the regulatory and consumer pressure to dump diesel technology and accelerate the shift to all-electric vehicles.
Petroleum-fueled SUVs such as the Mercedes GLE generate the bulk of profits for global automakers. All-electric Tesla gets praise for its innovation, but is scrambling to show a profit in the third quarter after a tumultuous year.
The challenge for established automakers is to design electric cars compelling enough to persuade consumers to pay a profitable premium to own them.
Legacy automakers have tended to produce electric cars that are drab, small or strange.
PSA Group's Peugeot e-Legend concept aims to break that pattern with a battery-powered homage to the 1968 Peugeot 504 that looks like it could have starred in a late 1960s French New Wave movie.
While not destined for production, the e-Legend does reflect a dilemma facing automakers like PSA - and its track-racing boss Carlos Tavares - over how to reconcile connected, autonomous cars with more traditional product traits such as driving pleasure, where their expertise really lies.
While the Peugeot fantasy car is self-driving, it can also be driven manually, or flipped into a "sharp" autonomous mode that accelerates and steers more aggressively - because, as the company said in promoting the concept, "boredom is not part of our DNA". (Reporting by Joe White; Additional reporting by Laurence Frost; Editing by Mark Potter)