Is the E39 M5 Still Worth it?
Early 2000s M-Cars have been going up in value as of late - particularly three pedal M3s and the manual only M5. But is the M5 still worth the money?
Back in the mid-80s, the first BMW M5 was born when the engineers in Munich decided to take the engine out of their M1 supercar and shove it under the hood of the 5-Series sedan of the time. Fast forward 15 years or so, and by the turn of the millennium the M5 had become a symbol of both performance and status – the car that appealed to businessmen and boy racers alike. In 1998, BMW introduced what many believe to be the best M5 ever made – the E39 generation. Most of us here will know about the E39 M5, but for those who don’t it featured a 4.9L “S62” V8 producing 394 horsepower and 369 lb-ft of torque, mated only to a six-speed manual transmission which propelled the car to 60 miles per hour in 4.8 seconds and on to a top speed limited to 155 miles per hour, though in testing of cars without limiters, the top speed was over 185 miles per hour.
Unsurprisingly, the E39 M5 has become an increasingly desirable collector car. High mileage and modified examples currently can be had for under $20,000, which is pretty reasonable. Low mile, clean, survivor cars though currently are listed around $60,000 or $70,000, and I suspect they’re only going to keep going up. But why? What makes these M5s so special that people are willing to pay for a 20-year-old BMW what they’d pay for a brand new M3? Allow me to explain.
Photo by Issac Chan (@issac_photo)
First things first, there’s the way the E39 M5 looks. As I’ve said in my article on the E46 M3, German cars from the 90s and early 2000s weren’t styled the way they are now. Back then, they were subtle. If you weren’t looking carefully you wouldn’t realize the rather typical looking sedan next to you was ready to blow your doors off when the lights went green. Often times when we talk of high dollar classics like the Jaguar E-Type or any of the Italian sports cars from the 1960s, we talk about timeless design as part of the reason we still lust after them. The E39 has that in its own way, but rather than coming from the pen of a master designer, its beauty comes from how elegantly simply its design is. All the little details are there for function and none of them are any more than they need to be.
As for the interior, I will insert a little disclaimer here that the example I drove and that is pictured in this article is a high mileage car, not one of the pristine survivors. That said, the interior still looked quite good for its age and mileage, and from speaking with the owner, it didn’t take much to freshen it up. The few trim pieces that were changed were easily found online, and the now very dated navigation head unit is easily replaced with a modern unit that when the screen is off, is nearly indistinguishable from the original. With that said though, the interior is just what you’d want from such a car. The seats are comfortable and compared to a more modern BMW things are much less complicated, while still having the basics one would expect from a modern car.
Finally, there’s the driving experience. First and foremost, it has to be said that the E39 M5 isn’t a sports car, and never was. The M5 is a sports sedan – the M3 is a sports car. The difference being that sports cars like the M3 are built to carve through canyons and tear up racetracks, while sports sedans are meant to carve up the miles and tear up autobahns. The E39 isn’t bad in the canyons by any means – the steering is sharp and surprisingly communicative if you’re used to modern BMWs – but even with the extra horsepower it can’t compete with the M3. Where it really shines is on the highway when you can bury your foot in it and feel it surging you to higher and higher speeds. The engine makes a great note, particularly with a modified exhaust that really lets you hear it like the example I drove had. It’s not as rev happy as the S54 in the M3, but that’s no surprise, and also unsurprisingly it pulls much harder from the extra torque two extra cylinders bring. The gearbox and clutch also feel excellent and are fun to use, and a nice change in a world where manual cars are dying off. If I had to sum up the M5, I’d describe it as a prime example of a German muscle car. It can be comfortable cruising in high gear, but it’s happy when your foot is down and it’s pulling its way through the gears.
So does all that make it worth the money? For a higher mileage car that’s under $30,000, yes, but for a survivor that’s over $50,000 or $60,000, it’s a different question. I think the E39 will only continue to climb in value. Why? For starters, it’s from the golden age of BMW – the early 2000s were simply the best years of BMW in terms of brand value, lineup, and product quality (again quality, not reliability). Second, it’s the last M5 that feels really special. Yes, the following M5 had the V10 and an option for a manual transmission, but that engine is a maintenance nightmare and the styling was controversial at the time and hasn’t really improved with age. The following M5 have gotten better as tools for businesspeople to get from place to place very quickly, but it’s said they lost the feeling of being driver’s cars. Third, which sort of piggy-backs off that last point, it’s the last BMW to have been offered only with a manual transmission, and as has been seen over the past few years, manual transmissions really push up the value of collector cars now that the manual is dying off. The downside to this, though, is that the properly clean cars are going to start getting stashed away into collections and not driven because they’re seen as investments. Yes, I understand the desire to keep cars like those pristine and preserved, but cars are meant to be driven, particularly cars like the E39 M5.
As a final note, I'd like to thank Issac Chan (@issac_photo & @kit_kat_m5) for lending me both his talents as a photographer and his M5 for this article. I'd also like to thank Chris Lee (@chrisleestudios & @m3.raw) for additional photos.
Photo by of 5 BMWs by Chris Lee (@chrisleestudios)