BMW Pins Profit Hopes on Remade 5-Series

German automaker BMW launches its new-model offensive in earnest today as its redesigned 5-Series cars go on sale in Europe -- a make-or-break product launch that will determine profit for years to come.

The 5-Series, wedged between the smaller, mass-market 3-Series cars and the high-end 7-Series, represented only about 20% of BMW’s sales volume last year but contributed 35% to 40% of the automaker’s profit.

Georg Stuerzer, auto stocks analyst at HVB Bank in Munich, described the 5-Series as “the backbone of BMW’s business.”

The 5-Series, last remade in 1995, is the most important new design in BMW’s high-stakes attempt to shake up its product line this year and next. The X3 sport utility vehicle and 6-Series luxury coupe will follow this year, with the small 1-Series “baby BMW” to follow in 2004.

Stuerzer said the company’s older models were sometimes criticized as too conservative and looking too much alike.

“Now the model differences are much sharper,” he said.

He said the 5-Series’ technical advances, such as an active steering system that improves handling by adjusting steering response for different speeds, would give the cars an advantage over competitors such as the Mercedes-Benz E-Class from German rival DaimlerChrysler.

The cars go on sale in Britain and the United States in the fall.