BMW is preparing to launch a tough competitor to the G-Class, which could potentially lead to the demise of the XM. | Carscoops

      A new flagship SUV is said to be in development, promising off-road capability, luxury features, and the ability to compete with the most formidable off-road vehicles.

      Reports indicate that BMW is working on a high-end off-roader aimed at challenging the Mercedes G-Wagen. Production is anticipated to commence in South Carolina during the latter half of 2029. This rugged SUV may take the place of the XM as BMW’s premium performance model.

      BMW's selection of SUVs is already extensive, ranging from compact crossovers to large luxury vehicles, including an M variant. However, there remains a notable absence: a true all-terrain off-roader that can stand up to the Mercedes G-Class, Lexus LX, or Range Rover.

      This gap may soon be filled, with indications pointing toward a new flagship SUV expected for launch in 2029.

      Inside sources informing Autonews suggest production of this off-road-focused model will start in the latter half of that year. Although a company representative has not commented on the initiative, it is reported that the vehicle will be manufactured at BMW’s Spartanburg facility in South Carolina, which also produces the X3, X4, X5, X6, X7, and XM.

      Designed for Tough Terrain

      Reportedly referred to internally as the G74, the SUV is expected to utilize the unibody platform of the next-generation X5, rather than that of the larger X7. This choice is likely to enhance its performance on difficult terrains. With the electric Mercedes G-Class facing challenges in attracting buyers, BMW is anticipated to rely on internal combustion engines for its new off-roader.

      Recent models, such as the X5 Silver Anniversary Edition—which comes equipped with the xOffroad package—indicate BMW's growing interest in the adventurous SUV market. It is reasonable to expect that the upcoming model will feature a more rugged aesthetic, enhanced suspension, and specialized off-road technologies to handle rough conditions with ease.

      Transitioning from the Halo XM Model

      The forthcoming SUV may occupy the top spot in BMW’s lineup, replacing the XM, but with a distinctly different purpose. The XM, recognized as the first standalone BMW M model since the M1 supercar, is not likely to have a direct successor. Production is projected to conclude as early as November 2028, just five years after its introduction.

      BMW seems to believe that a robust SUV will appeal more to premium buyers compared to the road-centric XM. This strategy directly targets the Mercedes G-Class market, distancing itself from competition with the Lamborghini Urus. Nevertheless, there is a chance for an M-branded version of the new off-roader, designed to offer a performance spirit akin to that of the Mercedes-AMG G63.

      According to Edmunds, persuading current G-Class owners to switch to a BMW will be challenging. In the United States, 65 percent of G-Class trade-ins result in a purchase of another Mercedes, indicating a loyal customer base.