Is the BMW Z4 M Coupe about to come of age?
We recently wrote about the surge of interest in 2000s-era BMWs among younger generations, a trend that shows no signs of slowing. Prices for the Z3 M Coupe—a cult favorite in this class—have leveled off after a lengthy rise, but given the car’s enduring popularity, we don’t see values coming back to Earth any time soon. That has us wondering: What’s going on with the Z3 M Coupe’s successor, the 2006-08 Z4 M Coupe? Is the flame-surfaced M machine a collector car in the making?
The right ingredients are there. Like its predecessor, the Z4 M Coupe (codename E86) was a high-performance hardtop version of BMW’s Z-Series roadster. The two-seat hatchback configuration continued, as did the use of the naturally-aspirated, 3.2-liter straight-six (codename S54) from the M3. The S54 makes 330 hp in the Z4 M, compared with 315 hp in the Z3 M, and is mated to a six-speed manual transmission rather than the previous car’s five-speed.
Despite the common engine, though, the Z3 M and Z4 M were completely different cars. Remember that the Z3 platform combined the front strut-type suspension from the E36-generation 3-Series with the archaic semi-trailing arm rear suspension from the earlier E30-generation 3-Series. It was a small, squat, odd-looking, high-revving German hot rod with M3 power and a lively, even squirrely demeanor when pushed. The Z3 M Coupe was designed and engineered as a rewarding driver’s car on the road, rather than a proper track machine.
The Z4 M, on the other hand, was much more of a road-course weapon, sharing its basic suspension setup (front struts and multilink rear) with the E46 M3: front control arms, rear subframe, and anti-roll bar mounting points are all common, as is the M-specific variable-lock differential. Key components came from the limited-run M3 CSL as well, including the cross-drilled brakes and steering rack.
This renewed focus on track capability, made possible by the Z4’s more modern platform and a number of off-the-shelf BMW M parts, achieved two things. First, it legitimized the connection between the Z4 M road car and its race-car cousin, the E86 Z4 GT3. (BMW did not go racing with the Z3.) It also allowed BMW to compete head-on with Porsche’s new-for-2006 Cayman S.
We drove the Z3 M and Z4 M Coupes back-to-back earlier this year, on admittedly flat and boring Florida roads. Still, even in ordinary traffic the cars feel fundamentally distinct. The Z3 M Coupe is friendly and tractable at low speeds, but it doesn’t take much prodding to coax out its wild-child personality. Big stomps on the throttle cause the whole front end to rise as the car leans back on its widened haunches. The suspension is just compliant enough that the driver is aware of mid-corner motions, and smooth transitions demand focused steering and throttle inputs.
The common thread that runs through to the Z4 M is the screaming inline-six, which begs for high revs. After that, things begin to diverge. A big difference compared with the Z3 M is that the newer car’s updated transmission employs shorter gearing, the result of which is a much more high-strung personality in low-speed traffic. The powertrain does not like to loaf around, but rather wants to GO. NOW. This car settles into a confident rhythm once you really get on it, winding out each gear to the 7900-rpm redline and being generous with the throttle on upshifts. In general, the car feels more serious and purposeful than the playful Z3 M. It’s the type of car that only really comes alive near the peak of its performance threshold.
On the outside, the Z4 M looks more conventionally attractive. The roofline is its signature styling touchpoint, boasting a beautiful, gentle curve from the A-pillar to the stubby rear end. The entire design is more of a single piece than that of the Z3 M Coupe, whose goofy breadvan looks earned it the nickname “Clown Shoe.” For some, of course, the oddity is part of the Z3 M Coupe’s appeal.
The Z4 M has a clear edge inside, at least from a quality standpoint. No Z3 was celebrated for its interior, but the Z4’s improved leather and plastics better meet the expectations of a premium brand like BMW. The most evident changes are the updated steering wheel (noticeably thicker) and the deep-set instrument binnacle (more difficult to read at a glance). The Z4 M also has a Sport-mode button, which increases the responsiveness and reduces hydraulic steering assist when pressed.
For BMWs in particular, rarity and performance are high drivers of collectibility, which should immediately benefit the Z4 M. This car is lighter and faster than the much-loved E46 M3, and only 4581 Z4 M Coupes rolled off the factory line in Spartanburg, South Carolina over three model years, which is a sight fewer than the 6291 Z3 M Coupes built between 1998 and 2002.
The Z3 M coupe boom began in 2019, when #3 (Good) condition S54-powered cars shot up 25 percent between January and May, from $31,000 to $38,800. Values briefly retraced themselves in the later part of that year, but since then, #3 condition M Coupes marched steadily to their current plateau of $55,200. Top-flight cars are even more valuable, with #1 (concours) condition cars bringing $105,000 on average.
At this point, even the very best Z4 M Coupes do not command six figures. Bring a Trailer has brokered some sales in the mid-$50,000s and low $60,000s, but the bulk of Z4 M Coupes are changing hands in the $30,000-$45,000 range, depending on color and condition.
If there’s room on the Z4 M train now, we have our money on millennials to be the first to hop on. The majority of collector-status BMW enthusiasts are in this demographic, and they’re quoting with Hagerty with higher values than any other generational group. As always, a younger fan base (whose earnings on average increase over time) usually promises a healthy road ahead for any collector vehicle. The E90/92-generation BMW M3, which launched in 2009, is already coming into its own thanks largely to millennial support.
The jump to the Z4 may not be a stretch for millennials, who already have an appetite for the Z3 M Coupe, says Hagerty senior valuation analyst James Hewitt. “The Z3 M Coupe is attracting younger buyers. Forty-five percent of M Roadsters are quoted by baby boomers, compared with just 27 percent of M Coupes. Millennials account for almost all of that delta, which seems to suggest they love the car.”
From where we’re sitting, the 2006–08 Z4 M Coupe will certainly have its day in the collector market. If and when the bump comes, however, it’s tough to say whether it will reach the value heights achieved by the earlier Z3 M. Eventually, buyers may come to appreciate the Z4 M as the last of a breed; the E89-generation Z4 that followed produced no hardcore M version, and though there is a high-performance six-cylinder coupe version of the Z4 in showrooms today, it wears a Toyota badge and is called the Supra. The Z4 M’s performance improvements are undeniable, and for some that will be the key differentiator. But when it comes to pure personality, the original M Coupe is tough to top.