New BMW M5 Is Cheaper Than The M3 If You Live In The Right Place

After countless teasers and a lengthy wait, the new BW M5 has finally arrived. With 717 horsepower and a curb weight of 5,390 lbs, the new M5 is all about big numbers. That includes the $119,500 price tag, which makes it way more expensive than the more compact M3 – unless you live in Ireland, of course.

As reported by Motor1, the new M5 is cheaper than the M3 across the pond. No, that’s not a mistake. In Ireland, the M5 retails for €137,035 ($147,254), whereas the M3 Sedan (updated for MY2025) will set buyers back €151,665 ($163,000). So, how can a larger, more powerful, and more premium car cost less? Why would BMW price the M3 above the M5? It turns out it has nothing to do with the automaker and everything to do with Ireland’s Vehicle Registration Tax (VRT).

How Can The M5 Be Cheaper Than The M3?

The VRT is based on CO2 emissions, which means cars that emit less pollution are taxed at a lower level. According to Vehicle Registration Tax Ireland, VRT is applied to new vehicles and those imported into Ireland. “The total VRT due depends on the vehicle’s Open Market Selling Price, carbon emissions, and nitrogen oxide levy and ranges from 7% to 37%.” The M5’s electrified V8 puts it in the lowest tax bracket. It emits 37g/km, which is below the 50g/km threshold.

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Because the M3 uses a straightforward combustion engine with no electrification, it spews out more CO2 emissions. The 3.0-liter inline-six has a WLTP-estimated figure of 228 g/km, much higher than the highest tax bracket of 190 g/km and above. This difference in CO2 emissions is what makes the M3 more expensive than its bigger brother. Of course, the idea that the M5 produces fewer CO2 emissions is based on lab testing. In the real world, the V8 is likely to be more polluting than the figures claim, although the 43 miles of all-electric range does come in handy (an estimated 25 miles in the USA). It’s worth noting that the M3 is only sold in Competition xDrive guise in Ireland.

Popularity In Performance PHEVs On The Rise

This is precisely why automakers are opting for plug-in hybrid setups, particularly for performance cars. It’s the ideal way to enhance performance while reducing emissions, allowing these cars to dodge hefty taxes that would push their prices up. However, this isn’t always the case. Take the new four-cylinder Mercedes-AMG C63. Stuttgart’s controversial performance sedan costs even more than the M3 and M5 in Ireland, with a starting price of €164,240 ($176,700).

Related

Everything To Know About The 2025 BMW M5

The brand-new M5 is now a PHEV and ups the power, weight, and complexity, but promises to remain a true M car.

As a result of the hefty emissions tax, the M3 is one of the most expensive BMW M passenger cars available in Ireland. Even the high-end BMW M760e xDrive is cheaper, with a starting price of €148,965 ($160,235). While new car prices are nothing to celebrate in the United States, we don’t envy gearheads in Ireland, where prices are ridiculously high. A BMW M8 Competition Convertible, for example, is priced at an eye-watering €266,835, which works out to $287,000. And it’s not just high-end cars that come with insane price tags. Even humble family cars like the Corolla Cross are astronomically priced, with a base MSRP of €38,380 ($41,300).

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