The E34 is a great chassis which unfortunately came with some rather anemic 6 cylinder engines in non-M form. While the M50 is a stout and reliable motor, it leaves a little to be desired as far as performance goes. While forced induction is a great choice for many, others prefer the performance and feel of the stock engine but just want a little more power. Using the engine from a newer model is always a great solution and on that note the S52 offers a large increase in displacement over the largest M50 available (3.2 vs 2.5L) as well as a big increase in stock power output (240hp vs. 189hp) while still maintaining the original look, feel and balance of the car

 

This swap guide pertains specifically to the swap of an S52 from a 1998 Z3 M Roadster into a 1992 E34 525i wagon which was an automatic and RHD. The information should pertain to just about every M50 powered E34 but V8 or M30 models will find many things to be different and it is a lot of extra work to swap those engines to S52's. S50 and S52's are mostly the same and I do try to detail the few areas they are different. If using an M52, you will be following the information for the S52

 

Do note that starting with a VANOS M50 car will mean you need less parts purchased separately to do the swap, but you will also get the less reliable Getrag transmission unless you swap that too. I would recommend looking for a non-VANOS manual E34, so you get the ZF 5 speed from the factory and only need to source a few parts from a VANOS E34. The engine harness and electrical parts you need to swap a non-VANOS to a VANOS car are usually much cheaper than upgrading a Getrag to a ZF transmission (although you can bolt the Getrag to the S52 if you wanted). A non-VANOS E34 525i was sourced for this swap as a donor to get most of the required manual swap parts from 

This E34 sold for $28,750 on BringATrailer.com in 2021 - S52-Powered 1992 525i Touring 5-Speed

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