THE 2979cc M54 is one of the newest and finest examples of BMW's inline six-cylinder engine expertise - it had to be considering how good the M52 it replaces was. The two engines share the same aluminium crankcase with the extra capacity coming via a stroke increase from 84.0 to 89.6mm. Like its predecessor, the M54 is a double overhead camshaft, 24-valve engine. It employs the latest version of BMW's double VANOS variable intake and outlet camshaft timing system to increase the flexibility of power delivery. It produces 20 per cent more power and 7 per cent more torque than the old engine. Premium unleaded is recommended but a knock sensor ensures the engine can handle lower grade fuels - albeit with a power loss.