The third generation of the 5-Series was introduced by BMW in November 1987 it’s mid-size sedan contender in the premium segment.
In the mid-’80s, the battle for the premium mid-size segment was mainly between the Mercedes-Benz E-Class and the BMW 5-Series. By the time when the third generation of the 5-Series was introduced, the two car-makers already took their paths, with BMW going for sportier models and the Mercedes-Benz for more comfortable cars.

The third generation of 5-Series kept the four-round headlights on the front, with a wide and narrow grille. The BMW “kidneys” were more exposed, with silver or body-colored rim. The plastic bumpers were already a fashion and the older, chromed ones, were part of the history. Still, a black rubber strip was kept.

The dashboard was tilted toward the driver and it offered the controls for HVAC and audio system, plus a pair of vents. The instrument cluster was typical, with the speedometer, tachometer, fuel level, and coolant temperature, plus an additional “economy” dial which showed the instant fuel consumption with a dial.

Under the hood, the 1988 5-Series was offered with a choice of gasoline and diesel engines. It was the first 5-Series available with all-wheel-drive for the 2.5-liter gasoline unit. The standard transmission for most of the engine range was a 5-speed manual, while the 540i was offered with a 6-speed unit. A 4- or 5-speed automatic was offered on selected models. The 5-Series was the first BMW to offer Electronic Damper Control and the introduction of Automatic Stability Control + Traction (ASC+T or ESP).