BMW's M50 Inline-Six Makes the E34 525i and E36 325i Tough, Affordable Classics

BMW's M50 inline-six powered the E36 325i and E34 525i, and it has built a strong reputation as a simple, durable engine. Introduced in 1990 as the replacement for the M20, the M50 used a cast-iron block and aluminum cylinder head, and it was naturally aspirated. 5-liter M50B25, made from 1990 to 1992, produced 189 horsepower and 181 pound-feet of torque.

With regular maintenance, many examples have reached 200,000 or even 300,000 miles. One E34 525i on BimmerForums reportedly had 426,000 miles on the odometer, while another had 313,000 miles and was still running.

The engine's biggest weakness is its cooling system. BMW used plastic water-pump impellers and thermostat housings, which can fail over time and cause overheating. That can warp the aluminum head and damage the head gasket, leading to coolant mixing with oil and possible engine seizure.

The fix is straightforward and inexpensive: a metal-impeller water pump costs just under $50, and a metal thermostat housing runs about $30. Unlike newer BMW engines with turbochargers and complex systems, the M50 can be maintained with a basic socket set and patience.

The M50-powered cars also offer a low-cost way into classic BMW ownership. The E34 525i and E36 325i have hydraulic power steering, simple rear-drive chassis, and strong aftermarket support. Prices remain far below BMW's M models: the E30 M3 averaged $97,235 over the last six months, while the E36 325i averaged $12,098 over the past year and $13,914 in the last six months.

The E34 525i has an average value around $10,815 and is currently climbing.

Both cars are now more than 30 years old but still practical enough for daily use, especially if the cooling system is addressed. As more people discover this combination of simplicity, classic appeal and bargain pricing, the low-price window may not stay open much longer. As with any classic car investment, future values remain uncertain.