Although only differing subtly in appearance from the myriad workaday Peugeot 205s that filled the streets of Europe in the mid-1980s, the homologation-special Turbo 16’s muscular body alluded to the highly advanced, rally-bred powertrain that hid beneath.

The 16-valve turbocharged engine was nestled not under the front bonnet but instead where the rear seats would otherwise have been placed. This necessitated the widened stance, uniquely large C-pillar arrangement, and of course, the massive rear hatch. The T16, an example of form following function, was as striking to look at as it was to pilot, thanks to a tenaciously grippy all-wheel-drive system made possible by an “epicyclic” centre differential and viscous coupling system. In true rally fashion, the driver could apportion power between the front and rear axles when needed.

The tubular structure hidden beneath the bodywork allowed Peugeot to significantly stiffen the T16, as it was known outside of its native France, in full World Rally Championship competition form. In WRC tune, the car boasted 500-plus horsepower from the XU-series turbocharged and intercooled four-cylinder. The road going model was rated at a more roadworthy 197 horsepower, which is an impressive figure for a hot hatch more than 30 years on.

Only 200 examples were built under contract by Heuliez for WRC homologation. Whilst they may not be all-out rally cars, they are very close, yet far more comfortably trimmed. Uniquely, their rear hatchbacks opened halfway across the roof line, allowing for astounding access to the mid-mounted engine.

Offered here is the 152nd of 200 T16s built for the street. It was originally delivered in the autumn of 1984 to Peugeot’s Italian office for press demonstration purposes and was featured in Italy’s leading motoring magazine, Quattroruote. Noting the T16’s importance, the magazine’s editors sent former Formula One driver (and current F1 television commentator) Ivan Capelli to put the Peugeot through its paces. A striking photo published in the magazine shows the T16 splashing in true rally style through a puddle. The Peugeot displays the same registration plate number that matches its immatricolazione documentation from the Automobile Club d’Italia.

Today, the T16 shows only limited signs of use in its two-tone grey seats and metallic grey exterior with its distinctive red stripe. The T16 is all original, aside from a Nardi Personal sport steering wheel and magnesium Group B wheels. A recent service was completed by R3 in Reggio Emilia, where new shocks, brakes, and a brake servo were installed, in addition to a full replacement of fluids and belts.

As a result, this T16 is ready for its next owner to get a taste of what Group B stars Timo Salonen and Juha Kankkunen experienced when they won the 1985 and 1986 Constructors’ and Drivers’ titles, respectively, in this deceptively fast hot hatch.