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The Birth of BMW’s Game-Changer: How the X5 Redefined the SUV Landscape

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The Birth of BMW’s Game-Changer: How the X5 Redefined the SUV Landscape

SHERIDAN, WYOMING – June 11, 2025 – Long before the SUV craze took over American driveways, BMW saw an opportunity not to follow but to lead—and in doing so, it changed the automotive landscape forever with the debut of the X5, its first-ever Sports Activity Vehicle (SAV).

A Bold Vision in a Shifting Market

In the 1990s, American consumers were flocking to vehicles like the Ford Explorer and Jeep Grand Cherokee. BMW, with its portfolio of sleek sedans and wagons, was left watching from the sidelines. But not for long. Executives at BMW of North America, including President Vic Doolan and Head of Product Planning Rich Brekus, knew that something had to change.

“When I was being interviewed for the job,” Brekus recalled, “Vic asked me one critical question, and I still don’t know if it was a serious question or if he was testing me. He said, ‘Munich is thinking about doing a minivan. Do you think we should do a minivan?’ I said, ‘You’d be out of your mind to do a minivan, but you need to do an SUV. Not an off-road SUV, but an on-road SUV. That’s where the market’s going.’”

Engineering the Ultimate Driving Experience—in an SUV

Rather than simply copy the rugged off-road formula, BMW’s engineers, led by Dr. Burkhard Göschel, aimed to deliver something entirely different—an SUV that felt like a BMW. Göschel incorporated the driving dynamics of the 5 and 7 Series, borrowing suspension technologies and even utilizing Hill Descent Control from Land Rover to eliminate heavy mechanical components.

“In his own discussions with BMW management,” the report noted, “Brekus had insisted on specific attributes for such a vehicle. ‘I told them I didn’t want a truck. I wanted the form factor of an SUV, but I wanted it to drive like a car,’ Brekus said.”

Design That Spoke BMW—Inside and Out

The X5 wasn’t just about performance; it had to look the part. Chris Chapman at Designworks/USA and Frank Stephenson shaped the vehicle’s striking exterior, bringing together sleek lines and unmistakable BMW DNA. Even the C-pillar design became iconic.

“We fought hard to expand the rear luggage space, which was far too small in the first iteration,” said Doolan. “The X5 wasn’t designed to cart stuff, but to enable our owners to enjoy their activities. Therefore I thought it logical to call it a Sport Activity Vehicle rather than a Sport Utility Vehicle.”

The Launch That Made History

BMW’s bold move was unveiled to the world on January 9, 1999, at the Detroit Motor Show. The X5 stunned with its performance, especially in real-world tests.

“It had been an off-road site for testing Land Rovers, and the Germans were concerned that the X5 wasn’t strong enough to handle it,” said BMW’s Kenn Sparks. “Well, it handled it phenomenally!... Then, while the journalists were having lunch, the vehicles were washed, and we drove the very same vehicles to Road Atlanta. After doing this pretty serious off-roading, the next thing you know you’re racing through the chicane at Road Atlanta. That blew everyone away.”

Affordable Luxury That Opened Doors

At launch, the X5 was offered with a 286-horsepower V8 engine, but also with a more affordable 3.0-liter inline-six option, priced at $38,900. That strategic pricing broadened the model’s appeal and ensured strong sales.

“The initial pricing was critical in ensuring the success of the X5,” said Doolan. “Our proposal was $38,900 for the six-cylinder. The finance people wanted the price to be significantly higher, but thanks to a powerful argument delivered in English by Dr. Reitzle, we prevailed.”

Legacy of a Trailblazer

The X5 became a resounding success, with over 616,000 units of the first-generation model produced in Spartanburg, South Carolina. It set the stage for a full lineup of BMW SAVs and solidified the brand’s place in the American garage.

“The X5 transformed BMW,” said Doolan. “It facilitated the growth of Spartanburg into the largest plant in the BMW world, spawned a complete range of SAVs enabling tremendous growth of the BMW range globally, and enabled the sale of Land Rover to Ford, generating much-needed cash and getting rid of the albatross that was Rover.”

More than two decades later, the X5 continues to lead the charge, proving that performance, style, and versatility can live together—beautifully.

Learn more at www.bmwusa.com