An E46 M3 Touring & More: Turning BMW Dreams Into Reality


The Lore Is All-Consuming

Last year, to celebrate 50 years of BMW’s M division, the BMW Museum displayed their back catalogue of one-off M car prototypes from decades past. Usually hidden deep inside the nuclear bunkers of Munich, these unicorn M cars would finally see the light of day and be put on display for anyone who visited the museum. For me, this was a big deal.

Like most kids, when I was younger I was captivated by things that went largely unexplained. The unobtainable was exciting and mystical.


Open-world video games are a great example. I’d reach the boundaries of the digital map and be obsessed with what was behind them. How do I get there? Why can’t I go further? What lays behind this barrier? Deep down I knew the answers were simple. I knew it was just an undeveloped part of the game, but not admitting that and hoping for more was just so much more fun.

Naturally, this carried over to my interest in cars.


The quirks of large-scale manufacturers stretch wide and far. Different regions of the world often receive different colours and trims; other countries have a variety of engine options; and certain continents get completely new models altogether. The process behind these decisions has always piqued my curiosity.

I remember being a teenager and finding out the E60 BMW M5 came as a manual in North America but not in Europe, and being dumbstruck. My teenage brain couldn’t figure out why, and I didn’t want it to anyway. Again, lusting over it was more fun than understanding why it did not exist.

One day in the early 2010s, I found a photo of an E34 Convertible M5 on an internet forum somewhere. It was a snap from the 1990s, clearly dated by the image’s film quality and the old-style number plates on the car. I felt like I had discovered fire, rushing to tell anyone else across the internet that this little nugget of car trivia existed. The lore was all-consuming, and little did I know it was only the tip of the iceberg.


BMW has been producing secret M car prototypes for decades now, and as the internet matured some of these secrets slowly leaked out. Forums became filled with the old ‘my uncle’s neighbour’s older son’s nephew saw this in Munich in 2001,’ and so on, and so on. Keeping these secrets became harder, and BMW’s attitude towards them changed. The prototypes started to be revealed through PR exercises.


To my terrible disappointment, I was indeed not the person who discovered the E34 Convertible. That prototype was released to the public in 2009, to mark 25 years of the M5.

The E34 Prototype was the real deal, a proper, production-ready concept car which was actually booked in to be displayed at the 1989 Geneva International Motor Show. But a week prior to being shown, BMW pulled the plug over fears the model would slow down sales of their 3 Series Convertible.

There’s more, too. During the anniversary, BMW also revealed the E39 M5 Touring Prototype.


BMW clearly had other prototypes in their possession and repeated the gig in 2016 by releasing the E90 M3 Pick Up Concept to celebrate the M3’s 30th birthday. Whilst there, they also revealed an E30 Pick Up they had stashed away as a parts transport car some 26 years prior.

It’s as though BMW wanted to play a game with us. They kept dropping breadcrumbs of clues and hints at more potential models we simply never had, but maybe could have had. That was the beautiful curse of their game.


It’s fair to say out of all the M car ideas, one lingered around for longer than others and had grown a compelling following in the process (of which I was part of.). This year, BMW finally buckled and offered the public what they’ve always asked to see: a fiery take on the ever sensible car of the people, otherwise known as the M3 Touring.

As it happens though, today’s M3 Touring has been brewing for a while.

Those internet rumours of the past weren’t just rumours. Over 20 years ago, after the E46 M3 Coupe and Cabrio went on sale to the general public, the engineers at M GmbH tackled the E46 Touring body shape. This M3 model was going to happen, and behind closed doors it did.


Similarly to the E34 Convertible, the E46 M3 Touring Concept was the real deal. It was a fully complete, Touring M3 variant of the E46, from the S54 heart to a custom two-tone M3 interior and widened M3 exterior. It even went as far as being tested on public roads, which is probably where the rumours of the car first came from.

Of course though, BMW eventually denied us the right to this production car. They again pulled the plug on it. The experience, the idea and the dream of the E46 M3 Touring was just another fuzzy idea of an alternative reality, decommissioned to the unobtainable daydreams of car fans around the globe. Shame.


The E46 M3 Touring Concept was formally shown to the world in 2016, and we were quick to learn it wasn’t a failed mission. The man in charge of M prototypes in 2000, Jakob Polschak, went on record to say that the M3 Concept demonstrated that “from a purely technical standpoint at least, it was possible to integrate an M3 Touring into the ongoing production of the standard BMW 3 Series Touring with very little difficulty.”

And that, my friends, was an invitation. An invitation from the man in charge himself, for people like Luka Marko Groselj to get involved with the M3 Touring dream.

The Talent

Our story takes us south of Munich, to the beautiful Balkans country of Slovenia. Tucked away next to the mountainous regions of Northern Italy, the Slovenian scenery offers a mix of mountains dressed with snowy peaks, contrasting far-stretching greenery and a set of exciting, engaging driving roads often leading to a hill climb, with little-to-no room for error.


Today’s location is the AMZS Center Varne Vožnje, a small Slovenian track used mainly as a teaching ground for greater car control.

It may not look like it in the photos, but it was quite busy on the track. Every other minute a water sprinkler would go off in the distance, and we’d see a group of cars take on the slippery surface, growing their understanding of driving and car physics. It looked awfully fun, but not as fun as what was in front of me.

A race-ready E46 Coupe parked next to a car BMW never made. A very real E46 M3 Touring.


There’s a lot to unpack here, and this is all thanks to the protagonist of our story. The location you’re looking at here is actually Luka’s office.

Luka has been in the driving game for a long time now, far longer than his driving school has been set up for. He’s worked at the AMZS Centre as an instructor for a few years, but for the last six years he’s run his own drift school, acting as an instructor and coach for keen motorists who want to learn how to go sideways, and mentoring professional drift drivers.


Locals in Slovenia told me that Luka was right at the forefront of drifting as a bonafide motorsport, being one of the main drivers behind some iconic local track drifting videos that came out of the Balkans over the last 20 years.

The love for this came from an interest in Group B rally cars when Luka was younger. Before Fast and Furious movies came out, in the Balkans ‘drifting’ was a term that directly linked to rally cars.

Luka tells me: “Today, rally drivers chase milliseconds and prioritise the flow of the rally cars to be efficient, but when I think of Group B, drivers would be pulling the handbrake just to get the car pointing in right direction. I loved it.”


Luka had been keen to get behind the wheel of a car since he was a kid, so when he got his driving licence things simply snowballed. In 2003, he built his first track car. In 2006, he entered and competed in the German Drift Masters series. By 2012, he had built an E36 competition and show car largely based on the E36 GTR.


It wasn’t long before Luka was given opportunities to do some interesting work with a variety of companies and brands. Akrapovič, the exhaust manufacturer from Slovenia, was quick to notice Luka as the talent they needed, scooping him up as their main (and only) precision driver. Bilstein too liked what they saw, and began a partnership with Luka that’s still going strong. Today, aside from being a driving instructor, Luka often does stunt driving for various media productions across Slovenia.

It’s fair to say Luka’s childhood dreams have progressed nicely over the years as he became accustomed to the industry he works in.


One affiliation, however, has specifically grown stronger and stronger from Luka since day one, and that’s his love for BMWs.

Made To Fit


“I always wanted to turbo an S54 engine,” Luka tells me as we stand looking at the Coupe. “At the time, the plan was to build a budget race car, to help me get the whole S54 turbo thing out of my system.”

It was here that I would quickly learn that Luka’s love for driving cars run in tandem with a love for building them. Although everything is calculated and methodical, Luka isn’t someone to pass up a good opportunity. “This car actually started out life as a UK shell. There was nothing majorly wrong with it; it was totally rust free, and had never been crashed or written off,” he explained.


Luka toyed with the idea of swapping an S54 M3 drivetrain into another E36 chassis, but the timing and good deal of the E46 shell made it more convenient to just crack on and build the car where it belonged, as an E46. The shell would allow Luka to tick off another item off the to-do list, but this time around he was going to leave the build brief ambiguous for himself.

“It was not going to be built to win races or drift championships, because I didn’t want to focus it on either of those things. I just simply wanted to build a fast, turbo S54 M3 and set it up in a way that allowed me to drive it how I wanted to. I’ve done just that with this car. If I want to, I can slide it about pretty easy, but I’ve found it also outperforms many cars at time attack events. It’s surprisingly competitive, but most importantly it brings me a lot of driving joy whenever I use it, which is mainly for show runs for various events around the country.”


Luka didn’t want the build to be extreme and prioritised longevity of the engine. The Turbosystems setup he chose features a twin-scroll, ball-bearing turbo with two wastegates. It’s running somewhere between 0.5bar (7.3psi) and 0.6bar (8.8psi) of boost, allowing the largely untouched S54 to make 517hp at the rear wheels.


Check out the headlights, which needed to be cut on the inside just to fit the radiator setup for it all.

“Before this, I was used to driving 300hp naturally aspirated cars, so actually this was quite a step up for me. I have a rule for myself where I first like to feel like I’ve really mastered a car before thinking about more engine upgrades. It’s natural for everyone to want over 1,000hp these days, but it’s not something you can just jump into and use right off the bat.”


“517hp is just right for me and I’m really happy with it. Realistically, it will take me while before I feel I’ve used absolutely all of the power it has to give. There’s no need to hurry for anymore upgrades for now.”


In Slovenia, cars like these are not road legal. “If you’re caught driving this on the road, you’ll go to jail,” laughed Luka, but if anything it allowed him to focus the build solely on performance rather than creature comforts.


While the powertrain setup is pretty casual for Luka, the rest of the Coupe is very much a track-focused machine. The car was left-hand drive converted, and then just about everything deemed unnecessary was stripped out.


The extensive weight loss programme brought the Coupe’s weight down to 1,230kg (2,712lb), making it a staggering 340kg (750lb) lighter than the standard car. A lot of work was done to achieve this. The doors are made from carbon fibre by BMW themselves, coming from the factory Cup Championship cars. The roof was made by a local carbon fibre company, interestingly run by a Slovenian ex-Olympic javelin thrower. The factory fuel tank and all the mechanisms with it were replaced with a fuel cell.


Inside, there is of course no carpet or stereo. Instead, you’ll find a Recaro with Luka’s name on it. This is a one off, made-to-fit bucket seat that Recaro manufactured especially for Luka back in 2006 when he competed in drifting. Being one of the sponsors of the German Drift Masters series, Recaro invited Luka in for a tailoring day and the outcome is what you see here. So cool!


An interesting quirk of the interior is the position of the hydraulic handbrake. Luka told me it’s where it is because when he first started driving there was no go-to setup for hydraulic handbrakes and he had to improvise. “My first hydraulic handbrake setup included a stick of metal bolted onto a Lada Niva clutch master cylinder. I have simply gotten used to it in this position.”

Connecting the S54 to the rest of the car is a triple-plate Tilton clutch and Samsonas dog box. To keep costs down in this area, Luka went for an H-pattern shift instead of a sequential.


The roll cage was constructed in Croatia by Dark Motorsports. While Luka knows how to weld, this job needed to be completed by a registered professional to give Luka the right paperwork to enter the car into various events.


The E46 is sitting on a custom Bilstein suspension setup which still receives regular adjustment to make the feather-light coupe ever more perfect for Luka.

“Anyway, I can take the doors off, if you like?”

Why Not?


It turns out, for ease of use and replacement, every single panel on the Coupe is attached with quick-release clips. You could lay the whole car out on the floor like a technical inspection diagram, which is where the lightbulb moment came from.


Luka’s Coupe race car strikes a stark contrast with his awfully usable and robust E46 M3 Touring project. “You see, I’m a sucker for building nice cars,” he begins to tell me, as we start loading the race car bits into the back of the Touring.

Be very careful not to scratch the black trim on the top of the bumper, there can’t be many of these in the world,” Luka jokes.


I believe him. He got a chuckle back from me, but in that precise moment all those memories of chasing M car prototypes as a kid flooded back into my brain. I took a step back and looked at the whole setting, reflecting on the fact that, on paper, this moment shouldn’t be happening. BMW never made this car, and only 24 hours ago I was sitting in my bedroom in South London.

Over the years, a few people have done the full Touring M3 conversions, but in my opinion they never quite nailed it. Either the arches were incorrect, the car would have a facelift front end (sacrilege!), or some of the stylistic choices would throw the whole thing off. This one here though is perfect.

What Luka and the team responsible for the car did was pursue that childish curiosity of “why not?” And they ran far with it, a whole four years before BMW’s official website ever acknowledged the existence of the M3 Touring Concept.

This is what the car would have been like from factory.


Its current owner is Luka’s good friend Aleš Hafner, who bought it directly from Luka and was kind enough to bring it out in such rainy weather for our story.

“This is actually the fourth or fifth car I’ve bought from Luka. I’m not sure how he keeps getting away with… I guess it helps that he’s my buddy,” joked Aleš. But when faced with the opportunity to own this car, he had to go for it.


I asked Aleš if people on the street know what it is. “Some do… some don’t. Those who know M division understand and definitely take a second look, but to most people when they see it on the street it’s just another old car.”


“Despite the nature of it, this is the car that I take out not because I have somewhere to be, but because I actually enjoy what driving is all about. I have done some family trips in it though, and yes I’ve used the Touring aspect of it. I’ve had bikes in it, I’ve had my whole family in it. We’ve done trips to the Croatian coast in it, but its use is always down to me wanting to actually drive it.”


Aleš is an M guy through and through, with this being his third E46 M3. “This is the special one. I’ll never see another on the road, which definitely drew me into the purchase,” he says.

It’s no static museum piece, and Aleš makes sure it’s looked after, maintained and treated like an M car should be. “It likes being driven; M cars don’t like to stay stationary for too long.”

But, the road to get to this point wasn’t straight forward, and the two gents were happy to tell me all about it.

Run & Communicate


The Touring build began in 2012, starting as an idea between Luka and his friends. From the get go, it was going to be a demo car for Luka’s friends who owned a body shop (the perfect excuse!) Boomerang Bodyworks were responsible for everything to do with the visuals, while Luka was brought in as the mechanics guy, getting the job of plumbing up the engine and making everything work as it would in a true M3.

“The car was originally a 318i in ugly red… ‘Uglyrot’ I called it,” Luka tells me. He also explained that he wanted to start the project with a six cylinder base for symbolic reasons more than anything, but in hindsight it really didn’t matter. “If you look up the part numbers for the actual Touring chassis, they’re the same on the four cylinder and six cylinder models.”

Everything in the Touring came from an immaculate Coupe donor, including the S54 engine, rear differential, exhaust, all suspension components and the all-important M3 body panels.

“When we started to do all the mechanics, we simply grabbed the bits from the Coupe and fitted it into the Touring,” says Luka. “We made no upgrades or revisions; even the rubber bushes were taken from the Coupe and put into the Touring as the Coupe was in such great condition.”


Getting the engine to run and communicate with the Touring chassis was interesting. Luka explains: “We wanted to use the electrics from the Coupe to make sure the DSC and everything worked perfectly, as if it the car was an original M3, including the Sport buttons and so on. But we had a real struggle to get electrical power to the rear. We couldn’t get the actual Touring part of the car, such as the trunk and rear doors, to come alive.”


“Our building methods were a little different back then; this car was built over a decade ago now. Back then we didn’t know anyone who could code out the issues if we tried using the original Touring wiring with the S54. We just couldn’t make it work that way. Our technology and knowledge has advanced since though, so if I was to do it again I’d definitely use the original Touring wiring to work with the S54. All our headaches from back then can be avoided now,” Luka says.

“We had to have a few people help us to make sure it worked, and in the end of course we got it done. Electrically, as so mechanically, absolutely everything worked on the car back when we finished it and it’s stood the test of time as everything still works today.”


Once the car was complete, Boomerang stuck to their original plan and used the Touring as a demo car for their body shop, but after seven years with the car, in 2019 it was time to let it go to a new owner. Being good friends with the shop, Luka says “Boomerang forced me to buy it! I didn’t want it because I knew how much it cost to make and I didn’t have that sort of money.”

But, as a lot of good stories go, Luka was eventually cut a deal he simply couldn’t refuse and the car finally entered his ownership. Here, the fun could really begin.

Improving The Idea


“The first thing I did when I bought the car was to put a manual gearbox in it.” When Boomerang asked Luka to take all the mechanics from the Coupe to the Touring, they meant all the mechanics. The Coupe came with an SMG transmission, and whilst it’s a unit that in my opinion doesn’t deserve the funny reputation it has today, Luka needed a third pedal to suit his driving style.


Next on the to-do list was to take a look at all the bushes and suspension components he had fitted seven years prior. Luka got a little carried away though.

“The idea was to just make a few revisions here and there, but I dissembled the whole suspension setup and ended up replacing every single bush.” With that taken care of, it was time for Luka to make some signature modifications to the car.


“I looked at how I could make the car ride a little nicer over the standard M suspension and installed a set of Bilstein B8s. It’s lower now too, but just a little and it drives a lot nicer.”

Following this, Luka tackled the rear end. “The standard M3 differential is good, but having owned a few now I’ve learned that they wear out pretty quickly and need some general adjustment.”


Luka pulled apart the limited slip differential and replaced the insides with an old-type E39 M5 ZF unit. It’s a stronger differential which doesn’t suffer from breaking flanges that the later units had issues with, and offers an advantage over the regular LSDs. The regular M3 LSD has a delay of a couple tenths of a second where it slips just the outside wheel before activating, something Luka could eliminate with the ZF unit.


With that done, Luka finished off his drivetrain mods by fitting the ever-popular 3.91 final drive to replace the factory 3.62:1 ratio. This allowed the car to be nippier off the line, helping to make up for the extra weight of the touring shape.

What Luka wanted to achieve with these mods was to improve on the original ethos of the E46 M3, really focusing on the idea of making it follow BMW’s slogan of the ‘Ultimate Driving Machine’.


In order to get there, Luka needed to tweak the driving position, a job which he was rather proud of. He cut down the seat rail mounting points, directly amending the chassis in order to lower the driving position by 30mm. “While this isn’t a problem in the Coupe, I find the whole cabin of the Touring seems almost a little higher,” Luka explains. The seats were definitely too high for me, and I’m not even that tall. And so, I had to do something about it. The way they are now is absolutely perfect.”

“I was considering a set of Recaro Pole Positions, but in the end I decided to stay with the more civilian look, and the M sport seats were perfect for that.” I asked Luka why the car doesn’t have seats from the M3, as they seemed to be the only obvious things missing. “I’ll be honest, I just really don’t like them. I find the M sport seats much more comfortable.”

The only visual exterior change Luka made to the car was to fit the factory Touring roof bars.


So, the big question – how does it drive? “The Touring does feel different to drive compared to the Coupe,” says Luka. “The extra weight makes it stick to the ground a bit better, so it’s not as tail-happy as the Coupes. Partly because of that, I think the Touring would actually make a great introduction car to the M brand. It’s a great car for less skilled drivers, and you really need to go for it in order for the back end to step out and misbehave. Coupes are much more rowdy and aggressive.”


After two years of ownership, Luka sold the Touring to Aleš. The original plan was for Luka to keep it longer, and he actually gave the car to his wife for regular use. But in the end she didn’t want to commit to using the rare, low, sports Touring. Apparently, she also doesn’t like Imola Red. Luka didn’t want to lock the car away either, and decided to pass it on.

Can You Tell?


Getting the drivetrain and mechanics sorted is one half of the coin though. In order for the E46 M3 Touring to really live and breathe, it needs to look like the real deal too. Where things get curious, is that Boomerang started the bodywork on this Touring four years prior to BMW’s official reveal of the Touring Concept. While I’ve found a couple leaks of the Touring Concept dating back to 2011, there wasn’t much but a few flip-phone photos to use as reference.


Boomerang dived into this project largely in the dark, but it wasn’t an issue. “Boomerang did not struggle with the exterior work as they had a lot of experience under their belt. They’re a great body shop, but even still, this job took a lot of time. Getting things spot is a time consuming job,” Luka tells me. “The first thing people ask about is the arches. These are original, from the Coupe. It’s just a normal M3 arch, and it was not much of a problem for them.”


The rear end of the car was obviously the trickiest part of the project for Boomerang. They decided to very slightly blend the rear arches into the doors, which is something BMW never did on the Concept. Jakob Polschak clarified that one of the rules he received from BMW for the concept car was that they couldn’t amend the rear doors, as BMW simply didn’t have the budget to alter the tooling.


Boomerang of course didn’t have to worry about this, and went ahead to create a perfectly flush rear door blend into the factory M3 Coupe rear arch. “This is how it would have been anyway, if Jakob had an unlimited budget back in 2000. The trickiest part of the whole thing though was the rear bumper,” sighs Luka as he shakes his head and brings me around the back of the car.


“This… this rear bumper was a real pain in the arse. Somehow, the Touring is a bit wider in the rear than the Coupe is, so we had to split the Coupe bumper in half, then blend it into an OEM Touring bumper, which is why this black trim underneath the boot lid is a one-off. We had to make a custom inset from plastic, so rather than it being factory unpainted plastic, it’s a smooth painted piece.”

“We needed to keep the exhaust dimensions the same as on the Coupe, so the rear bumper is a real mix up of custom jobs. Wider at the top, wider in the middle, and then back to the factory exhaust diffuser at the bottom. Here, Aleš added the CSL diffuser after he bought the car from me.”


The lower diffuser section is another place where the car differs from the Concept, as the Concept featured a totally unique diffuser which bizarrely poked out in line with the exhaust tips, in between them. There was of course no real way of knowing this would have been the case on the Concept when Boomerang built the Touring though.

Naturally, Boomerang used the Coupe as a benchmark for their take on the E46 M3 Touring rear end. In order to accommodate the M3 exhaust, Boomerang had to cut out the original Touring boot floor and replace it with one from the Coupe. While they were down there, Boomerang reinforced the whole area. Luke tells me, “This bit wasn’t too difficult for an experienced welder.”


The Touring wheelbase is exactly the same as a Coupe, so the side skirts clipped straight on. You’d think this would also be the case for the front end, but BMW threw Boomerang another curveball here. While the bonnet, bumper and lights did go on without kicking up a fight, the entire front wing design had to be chopped up in order to fit onto the Touring shape.


As it turns out, the Coupe front wings are much longer, meaning Boomerang had to carefully cut up the factory M3 front wings and transplant them into the skeletons of the Touring ones. The same applied to the wing mirrors, were Boomerang had to fit the M3 mirrors into non-M bases, which differ from the Coupe ones.

The attention to detail is truly stunning with this car, and the more I write about it the more I’m impressed with the overall outcome.


To finish my incredible time with Luka, Aleš and my good friend Dino (who put me in touch with the guys to begin with,) decided to line up the M3 Touring against Luka’s trailer just to admire what could have been. The car doesn’t have a tow hook, but if it did, this is what it would have looked like.

So, dear reader, I need to know… can you tell? Can you tell this car never came out of Munich? Because to me this looks like something Luka bought brand new at a BMW dealer back in 2001 and immaculately maintained until today. When Aleš told us that most people on the street assume this is just a regular car, he was paying credit to the team at Boomerang Bodyworks for doing such an immaculate job that most people can’t even tell it’s a custom project.


When BMW announced that the M prototypes would be out on display at their BMW Museum, I didn’t hesitate and booked a flight to Munich to go and check them out. My dad always had estate cars when I was younger, and we would always do long drives from London to Krakow and back to see the family. Seeing the M3 Touring would really be my meet-your-hero moment. For me it wasn’t a Countach, or an F40, but a silly BMW estate that could do my family trips at twice the speed we did it at.

Two weeks before my flight, and for some reason that was never explained, BMW pulled the display out from their museum ahead of schedule. I missed seeing this one-of-one, unicorn, dream concept car by two weeks. I didn’t know this until I rocked up, and I remember trying to figure out where the hell the cars were on the display. I asked three members of staff where the display went, and they all looked at me like I was crazy. They had no idea what I was talking about. I was absolutely gutted.


As it turns out though, I was looking in the wrong place. The real deal has been in Slovenia all along, being tracked in Luka’s hands and now crossing countries under Aleš’s ownership. Perhaps I’ll cross paths with it again one day. Until next time, M3 Touring!

Michał Fidowicz
Instagram: candyshowroom



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