
When a car is as special as Larry Chen’s European-spec Dakar Yellow BMW E36 M3, rebuilding its engine isn’t simply about replacing worn parts.
It’s about understanding what makes the original engine special, carefully evaluating its needs, and using the right combination of experience, machining, measurement, and components to build it correctly.
That is exactly what is happening with Larry’s legendary BMW S50B32 engine at VAC Motorsports.
Larry recently visited our New Jersey facility to see the progress firsthand and spend time with the VAC team working on the engine.
The project also brings VAC Motorsports together with our friends at Enthusiast Auto Group in Cincinnati, creating a collaboration between three names with a deep appreciation for special BMW M cars.

Larry Chen has spent decades documenting some of the most incredible cars, race teams, builders, and automotive cultures in the world.
This time, the camera was pointed toward his own project.
Larry made the trip to VAC Motorsports to see exactly what goes into rebuilding the S50B32 from his European Dakar Yellow E36 M3.

During the visit, he toured our engine-building and machining operation, examined many of the components from his engine, and spent time with Tony and the VAC team discussing the work being performed.
Larry summed up his experience this way:
“The care and attention to detail they are putting into making my engine better than new is amazing to see.”
That statement perfectly describes the project’s objective.
The goal isn’t to completely change what BMW engineered.
The goal is to preserve what made the S50B32 special while applying modern machining, precision measurement, upgraded components where appropriate, and decades of engine-building experience.

We are also proud to be working alongside Enthusiast Auto Group in Cincinnati, Ohio, on Larry’s E36 M3.
EAG has built a reputation around sourcing, preserving, servicing, and presenting some of the most desirable BMW M cars in the world.
VAC Motorsports brings decades of BMW engine-building, machining, cylinder-head and performance-component experience to the project.
Larry brings the ability to document the people, processes, and craftsmanship behind the build for enthusiasts worldwide.
Different areas of expertise.
The same appreciation for great BMWs.
That is what makes this collaboration such a natural fit.
The European S50B32 is far more than simply another E36 M3 engine.
BMW introduced the 3.2-liter version of the European E36 M3 engine for the later Evolution models, producing an impressive 321 horsepower from 3,201 cc in naturally aspirated form.

That meant BMW was producing more than 100 horsepower per liter from a production inline-six during the 1990s.
The S50B32 incorporated technology that was extremely advanced for its era, including:
While the North American E36 M3 was fitted with the very different S50US and S52 engines, the European S50B32 is a true BMW Motorsport engine, sharing architecture and engineering philosophies with BMW M engines such as the S14 and S38.
For enthusiasts who want an even deeper technical look at this engine, we have documented the platform in our complete:
BMW S50B32 Engine Rebuild Guide: Euro S50 Teardown, Inspection & Machining Explained
www.vacmotorsports.com/bmw-s50b32-engine-rebuild/
Larry’s engine allows us to demonstrate many of those same principles on an actual high-level E36 M3 restoration project.
One of the biggest mistakes in engine building is starting with a parts list.
A proper engine build starts with information.
Before deciding which pistons, bearings, rings, or other components should go into an engine, the existing engine needs to be:
Disassembled.
Cleaned.
Inspected.
Measured.
Every used engine tells a story.
Cylinder wear, bearing condition, previous machine work, overheating, oil contamination, improper repairs, and decades of use can all influence what needs to happen next.
The correct answer isn’t found in a catalog.
It is found in the measurements.
The factory S50B32 cylinder bore is approximately 86.4 mm.
But that number alone doesn’t determine which piston size to use during a rebuild.

Each cylinder needs to be measured for:
Those measurements help determine whether the cylinder can remain close to its original dimensions or require an oversize piston and additional machining.
If a block cleans up with minimal material removal, there is no reason to remove healthy cylinder-wall material unnecessarily.
If wear or damage requires additional machining, the appropriate oversize can then be selected.
This is why VAC does not believe in starting an engine build by simply asking:
“What piston size should I buy?”
The better question is:
“What does the block need?”

VAC Motorsports frequently uses CP-Carrillo forged pistons in performance BMW engine programs.
But piston selection is only one part of the equation.
Once the correct piston size is determined, the actual piston must be measured at the manufacturer’s specified measurement point.
The block is then machined to provide the correct piston-to-wall clearance for that specific piston and application.
That clearance can vary depending on:
Too little clearance can lead to piston scuffing, excessive friction, and cylinder damage as the piston expands with temperature.
Too much clearance can contribute to piston noise, oil consumption and poor ring control.
The correct clearance is not guessed.
It is measured and machined.

Boring and honing are sometimes discussed as though they are the same process.
They are not.
Boring removes significant material and establishes a new approximate cylinder diameter.
Honing establishes the precise final cylinder geometry and creates the surface finish the piston rings require.
That final surface finish is critical.
The cylinder wall, piston ring material, ring tension, ring end gap, oil control and piston-to-wall clearance all need to work as a system.
This is an important concept throughout the entire engine.
No individual component can compensate for incorrect machine work.
The European S50B32 cylinder head is one of the most fascinating parts of the engine.
Unlike the North American E36 M3 engines, the S50B32 uses a factory solid-lifter valvetrain along with a distinctive BMW Motorsport cylinder head and cam carrier architecture.

As engine speed increases, precise valvetrain control becomes increasingly important.
The cylinder head therefore needs to be thoroughly evaluated for:
VAC performs precision BMW cylinder-head machining in-house and utilizes equipment including our Newen Contour BB for highly accurate valve-seat machining.

Larry’s engine also allows us to demonstrate processes such as manganese-bronze valve-guide installation, precision valve-seat work and careful valvetrain inspection.
Cylinder-head work isn’t about making components look new.
It’s about restoring geometry, sealing, airflow consistency and durability.
Cleaning is another critical part of the inspection process.
VAC uses methods including vapor blasting on appropriate aluminum engine components.
Vapor blasting uses abrasive media suspended in liquid to remove oxidation, deposits and contamination while producing an excellent finished appearance.
But appearance isn’t the primary reason for doing it.
Clean parts are easier to inspect.
Carbon, oil, corrosion, and old sealant can hide:
You cannot properly evaluate what you cannot properly see.
Larry also got a close look at the S50B32 crankshaft during his visit.
BMW enthusiasts may notice a distinctive blue appearance on some forged BMW crankshafts.
That coloration is associated with manufacturing and heat-treatment processes used during production.
Once cleaned, the crankshaft is carefully inspected and measured.

Important areas include:
The crankshaft must also be considered as part of the complete rotating and reciprocating assembly.
That means pistons, pins, rings, connecting rods, rod bearings, and the crankshaft itself all become part of the balancing equation.
VAC Motorsports uses a CWT balancing system to precisely balance rotating assemblies.
Balancing becomes increasingly important as engine speed increases.
Even relatively small differences in rotating or reciprocating mass can generate substantial forces at high RPM.
Those forces can contribute to:
A properly balanced assembly helps reduce those unwanted forces and contributes to smoothness and longevity.
It’s one of the details you may never see once the engine is installed.
But the engine benefits every time it accelerates through the rev range.
Equipment matters.
Experience matters as much.
One of the people responsible for assembling Larry’s S50B32 is Paul, who brings approximately 65 years of engine-building experience to the project.

Paul began building engines when he was only 15 years old and has assembled thousands of engines throughout his career.
That kind of experience is impossible to replicate with equipment alone.
Modern measuring tools and sophisticated machining equipment allow us to work with exceptional precision.
But an experienced engine builder also understands what the measurements mean.
He understands wear patterns.
He understands bearing condition.
He understands what looks normal, what looks suspicious, and when something deserves further investigation.
The best engine-building environment combines both worlds:
Modern technology and decades of hands-on experience.
That combination is at the heart of Larry’s S50B32 project.

The phrase “better than new” is easy to use.
What does it actually mean?
In this case, it does not mean trying to redesign BMW’s S50B32 completely.
BMW Motorsport created an extraordinary naturally aspirated inline-six.
Our responsibility is to respect the original engineering while taking advantage of improvements available today.
That can include:
The objective is to preserve the engine’s personality while improving the foundation beneath it.
Even a serious S50B32 engine build needs an occasional intermission.
With Larry visiting the VAC team and our facility located just outside Philadelphia, Tony made sure lunch included one important piece of local culture:
Philly cheesesteaks.

So somewhere between examining crankshafts, cylinder heads, pistons and machine-shop equipment, the crew stopped for a proper cheesesteak lunch.
Engines need fuel.
Apparently engine builders, photographers and BMW enthusiasts do too.
Then it was back to work.
Larry’s engine demonstrates a philosophy VAC Motorsports has followed for decades.
A collection of expensive performance components does not automatically create a great engine.
The process matters just as much as the parts.
You can purchase outstanding forged pistons, connecting rods, bearings, valvetrain components, and fasteners.
But if:
The cylinder isn’t straight…
The piston clearance is wrong…
The ring gap isn’t correct…
The bearing clearance isn’t correct…
The cylinder finish doesn’t match the rings…
The valve geometry isn’t right…
The rotating assembly isn’t properly prepared…
Then the brand names printed on the boxes will not fix the problem.
Building an engine properly means treating everything as part of a complete system.
Whether we’re working with an S50B32, S54, S65, S85, S58, B58, or another BMW engine platform, the fundamentals remain remarkably consistent:
Disassemble.
Clean.
Inspect.
Measure.
Develop the correct combination.
Machine accurately.
Measure again.
Balance where appropriate.
Assemble carefully.
That process may take more time than simply bolting together a collection of new parts.
But it is also how reliable performance engines are built.
Larry’s visit to VAC Motorsports is only one chapter in this project.
We will continue documenting the engine as it moves through machining, cylinder head preparation, balancing,g and final assembly.
Upcoming coverage will take a closer look at:
You can also read our complete technical guide:

https://vacmotorsports.com/bmw-s50b32-engine-rebuild/
And follow the VAC Motorsports YouTube channel as we continue taking viewers inside Larry Chen’s S50B32 build.
Whether you’re restoring a European BMW M engine, developing a naturally aspirated track engine, or preparing a modern turbocharged BMW for serious horsepower, the correct engine combination starts with understanding the application and accurately evaluating the engine.

VAC Motorsports supports BMW enthusiasts, engine builders, performance shops, and race teams around the world with:
Before asking what parts you should buy, determine what the engine actually needs.
That’s where a proper build begins.
VAC Motorsports
BMW Performance Parts | Precision Engine Machining | Cylinder Head Development | Performance Engine Building