Significance: The luxury SUV market is one of the most contested segments around. While the new X5 doesn't look a whole lot different, it gets a third row seat, more power, and a long list of other improvements. It is again the gold-standard of the segment. But what else did you expect?
The first-generation X5's excellent chassis dynamics helped make it a performance-SUV benchmark, but its cargo hold was actually smaller than that of the 3-series wagon. To remedy this somewhat embarrassing reality--and move the X5 further away from the smaller X3--BMW engineers made the all-new, second generation X5 seven inches longer and two inches wider. This upsizing ended up yielding just eight percent more luggage space, but it did permit BMW to succumb to market pressure and add available third-row seating--albeit only for people who are no more than five feet, six inches tall.
The X5 uses a new control-arm front suspension, making it the first BMW since the late-'70s M1 supercar to not employ a damper-strut arrangement up front. The in-line six and V-8 engines are upgraded to 260 hp and 350 hp, respectively, and are mated to a standard six-speed manu-matic--meaning the new X5 is yet another BMW model that unavailable with a manual transmission.
iDrive is standard on the X5, but there are now six programmable buttons for quicker access to commonly used menu items. The X5 also gets available adaptive damping and roll control, a head-up display, a rear-view camera with a heated lens, and BMW's controversial active steering system. For now, the new front suspension, electronic chassis tricks, and standard run-flat tires keep the new X5 at the head of the SUV class, but the competition is catching up.