Look, let’s be real about the 2016 BMW X5 xDrive40e. When it first hit the showroom floors, it was a bit of a weirdo. Here you had this massive, luxurious SUV—the kind of thing normally powered by a thirsty straight-six or a growling V8—and BMW decided to shove a tiny four-cylinder engine under the hood. Then they paired it with an electric motor and a battery pack that, quite frankly, didn't offer a ton of range. People were skeptical. I was skeptical.
But things look different in the used car market today.
If you’re looking at a 2016 BMW X5 xDrive40e right now, you’re likely seeing prices that look like a bargain compared to the gas-only models. There’s a reason for that. People are terrified of aging hybrid batteries. They’re worried about the complexity. They see the "e" on the badge and think "expensive repairs." Honestly? They aren't entirely wrong, but they're missing the bigger picture of what this car actually provides if you know how to drive it. It’s a niche vehicle that works incredibly well for a very specific type of person and fails miserably for everyone else.
The 14-Mile Elephant in the Room
BMW advertised the 2016 BMW X5 xDrive40e as having about 13 to 14 miles of pure electric range. In the real world? If you have the AC blasting and you’re heavy on the pedal, you might only get 9 or 10. That sounds pathetic. If you have a 30-mile commute and can't charge at work, this car is basically just a heavy X5 with a small engine. You'll be hauling around a dead battery for 20 miles, watching your fuel economy tank.
However, if your daily life consists of school runs, grocery trips, and a gym visit all within a five-mile radius, you might not buy gas for a month. That’s the magic trick. I’ve talked to owners who treat it like an EV for 90% of their life and then use the 2.0L turbocharged engine for the occasional road trip to see family. It’s the ultimate "around town" luxury tank.
The powertrain is a 2.0-liter TwinPower Turbo inline 4-cylinder working in tandem with a synchronous electric motor. Total system output is 308 horsepower. It's not slow. It hits 0-60 in about 6.5 seconds. That’s faster than many base-model SUVs from that era. But the delivery is different. It’s silent. It’s smooth. It feels more "Rolls-Royce" than "M-Sport" when you're gliding through a parking lot on electrons alone.
Why the 2.0L Engine Isn't Actually Underpowered
A common misconception is that the engine struggles. "It’s too small for a 5,000-pound SUV!" people cry. Well, the electric motor provides instant torque—250 lb-ft of it. This fills in the gaps while the turbo is spooling up. It actually feels punchier off the line than the 35i inline-six model because of that immediate electric kick.
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BMW used the N20 engine here. It’s a polarizing engine, sure. Some early versions in other models had timing chain issues, but by 2016, BMW had mostly sorted those gremlins out. It’s a workhorse. It sounds a bit like a sewing machine compared to the glorious B58 six-cylinder, but you don’t buy a plug-in hybrid for the exhaust note. You buy it because you want to skip the line at the Costco gas station.
Living With the Battery in 2026
We have to talk about the 9.2 kWh lithium-ion battery. It sits under the trunk floor. Because of this, you lose the option for a third row of seats. If you have five kids, stop reading. This isn't the car for you. You also lose that deep storage well where the spare tire usually lives. You get a flat floor, but it’s slightly higher than the standard X5.
Reliability is the big question. These batteries are now roughly a decade old. While BMW offered an 8-year/80,000-mile warranty on the hybrid components (which has expired for almost everyone by now), the packs have actually held up better than the internet keyboard warriors predicted. You might see some capacity loss—maybe you get 11 miles instead of 14—but total failures are relatively rare.
What actually breaks? The auxiliary heaters and the AC compressors. In a PHEV, these are electric. If the electric heater goes out, your car won't pre-condition in the winter, and the engine might have to run just to keep you warm. These are $1,500 to $2,500 repairs. That’s the "BMW Tax" you have to accept.
The "Save Battery" Mode Secret
The 2016 BMW X5 xDrive40e has three distinct eDrive modes: Auto eDrive, Max eDrive, and Save Battery.
Most people just leave it in Auto. That’s a mistake. Auto eDrive is smart, but it’s not you smart. It will burn through your battery on the highway where electric motors are least efficient. If you know you're going to be stuck in stop-and-go traffic later in your trip, you hit that "Save" button while you're cruising at 70 mph. Let the gasoline engine handle the steady-state cruising, and save the juice for the crawl.
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This is where the 2016 BMW X5 xDrive40e becomes a fuel-sipping genius. If you manage the modes manually, you can easily average 35-40 mpg on a mixed trip. If you just drive it like a normal car and never plug it in? You’re looking at 22-24 mpg. At that point, you should have just bought the diesel xDrive35d.
Air Suspension: A Blessing and a Curse
Every xDrive40e came standard with rear air suspension to handle the extra weight of the batteries. It makes the ride incredibly supple. It levels the car when you load it up with luggage. It also leaks.
Eventually, those air bags will crack. You’ll walk out to your driveway and see the back of your car squatting like a lowrider. The good news? The aftermarket has caught up. You can buy Arnott replacement bags for a few hundred bucks and swap them out in a couple of hours if you're handy with a wrench. Don't let the dealership charge you $3,000 for this.
Interior Luxury That Actually Ages Well
The F15 generation X5 (2014-2018) is widely considered to have one of the best interiors BMW ever made. The materials feel substantial. The iDrive 5.0 system (which some late 2016 models got) is still usable today. Even the earlier 4.2 system is snappy.
You get the "Poplar" wood trim, the Dakota leather, and if you’re lucky, the Multi-contour seats. Seriously, if you find one with the 20-way adjustable seats, buy it. They are arguably the most comfortable car seats ever put into production. Your lower back will thank you.
The tech doesn't feel ancient yet. You have a decent backup camera, parking sensors, and usually a panoramic sunroof that makes the cabin feel like a greenhouse. Compared to a brand-new "budget" SUV, the 10-year-old X5 feels like a private jet.
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Real World Maintenance: What to Look For
If you're hunting for one of these, you need a pre-purchase inspection (PPI). No exceptions. You want a tech who can scan the BMW-specific codes, not just a generic OBD-II reader.
- Check the Charge Port: Sometimes the locking pin for the J1772 plug gets stuck. If it won't lock, it won't charge.
- The 12V Batteries: Yes, plural. There’s a main 12V battery and a smaller auxiliary one. If these get weak, the car’s computers go haywire. Most "hybrid system failure" warnings are actually just dying 12V batteries.
- Oil Changes: Because the engine cycles on and off frequently, fuel dilution in the oil can be an issue. Change the oil every 5,000 miles, regardless of what the computer says.
- Cooling Systems: There are multiple cooling loops for the engine, the turbo, and the high-voltage system. Look for white crusty residue around the hoses.
Is It Better Than a Lexus RX Hybrid?
Look, if you want to live forever and never visit a mechanic, buy the Lexus. But the Lexus RX450h feels like a motorized sofa. It’s disconnected. The CVT moans when you step on it.
The 2016 BMW X5 xDrive40e still drives like a BMW. It has a real 8-speed ZF automatic transmission. It has steering that actually tells you what the front tires are doing. It feels heavy, but "bank vault" heavy, not "clumsy" heavy. It’s a driver’s car that just happens to have a plug.
The Final Verdict for Smart Buyers
The 2016 BMW X5 xDrive40e is a brilliant used car for the "suburbanite." If you have a driveway where you can plug in every night (a standard 120V outlet works, though a Level 2 is better), and your daily commute is short, it is an unbeatable value. You get the badge, the luxury, and the utility without the $100 weekly gas bill.
However, if you live in an apartment with no charger, or you spend 4 hours a day on the interstate, stay away. You’re better off with the xDrive35i or even the xDrive50i if you don't mind the repair bills of a V8.
Actionable Next Steps for Buyers:
- Check the Vin: Run the VIN through a BMW decoder to see if it has the "Premium Package" or "Driving Assistance Plus." These add significant resale value.
- Test the EV Mode: During your test drive, force the car into "Max eDrive." If the engine kicks on immediately despite having a charged battery, there’s a fault in the hybrid system.
- Inspect the Tires: These cars usually come with Run-Flats. They are expensive and ride rough. Check the remaining tread; a new set of 19 or 20-inch tires will run you $1,200+.
- Download the App: Check if the vehicle’s "ConnectedDrive" services are still active. It allows you to warm up the car via your phone, which is a game-changer in winter.
The 2016 BMW X5 xDrive40e isn't a car for everyone. It's a car for the person who understands their own driving patterns and wants to exploit a loophole in the used car market. It’s complex, yes, but for the right driver, that complexity pays for itself every time you drive past a gas station.