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If you've seen the spy shots, you know BMW's next generation Z4 will be equipped with a folding hard top isn't much of a surprise. The mules undergoing testing show a two-piece metal unit that should be able to fold neatly into the trunk, while not infringing too heavily on luggage space.

More importantly, the new Z4 will be sporting a range of engine offerings, including an array of four- and six-cylinder mills, including the much-loved twin-turbo, 3.0-liter six found in the 135i, 335i and 535i. Additionally, AutoExpress dropped the bomb that a diesel engine will be fitted to the Z4 for the first time and that BMW might try to squeeze the 4.0-liter V8 found in the M3 into the Z4's lengthy hood.

All new Z4s will come equipped with BMW's Efficient Dynamics systems, featuring start/stop engine technology and some form of regenerative braking to boost electrical efficiency while reducing C02 emissions. The Z4's length is expected to increase by around an inch and it's due to hit dealers sometime in late 2009.

[Source: AutoExpress]

BMW's high-performance X5 prototype hit the test track again, this time showing some interesting changes compared to earlier test vehicles. While prior prototypes had some styling changes, the headlight design remained pure X5. On this newest prototype, the headlights appear to have been switched out with X6 headlights.

This latest prototype also features a new rear treatment. Earlier prototypes used the standard X5 rear valance, mocked-up to accommodate its new M-style quad exhaust set-up. The X5 shot yesterday, however, gets a new, larger rear bumper that wraps around to the middle of the rear wheel well. The rear fascia on the new prototype looks like a more-finished production applicatin compared to the initial test mules.

This hotter X5 prototype still remains something of an enigma. Three scenarios have been suggested: Is it an X5 M, a new X5 5.0is, or is it a mule for a V-10-powered X6. The application of a new production-looking rear bumper lends credence to the argument for a hotter X5–most likely the new 5.0is. The addition of the X6's headlights muddies the waters a bit more. Will this sportier X5 adopt X6 headlights while lesser X5s keep their normal lights, or will all X5s get X6 front lamps as a mid-cycle facelift?

While we can't say with certainty exactly where the X5 lineup will head in the next two years, it's clear that this hotter X5-based prototype is progressing toward a more finished product.

See the photos here:  LeftLaneNews spy shots of the BMW X5 M