BMW CEO Norbert Reithofer has previously revealed that future BMW powertrains will be downsized in an effort to improve fuel-efficiency and reduce emissions, and that even the hallowed ‘M’ division could also be affected by the new wave of environmental consciousness sweeping the automaker. BMW has always stood by the high-rev philosophy for delivering power from its M engines but that may be about to change.

We’ve already seen the potential of a twin-turbocharged V-8 engine in the X5 M and X6 M performance SUVs, and inside sources have revealed that the next-generation M5, due in early 2011, will be powered by a high-performance twin-turbo V-8 engine instead of a naturally aspirated V-10.

In the X5 M and X6 M the twin-turbocharged 4.4-liter V-8 M engine delivers 555 horsepower and 500 pound-feet of torque--enough to send the big SUVs from 0-60 mph in just 4.5 seconds.This should be more than enough output for the smaller and lighter M5 sedan and is already 30 horsepower up on the new E63 AMG.

The new V-8 will be matched to BMW’s M-DCT dual-clutch system, as found in the M3, but a conventional 6-speed will almost certainly be offered.

Performance will also be improved thanks to the extensive use of lightweight materials including carbon-fiber and aluminum. The car’s construction will be a hybrid of an aluminum spaceframe for the front section, and a traditional steel monocoque for the passenger compartment and rear. This will ensure a favorable front-to-rear weight distribution and improved handling. Up front will be an independent suspension with MacPherson struts, with a multi-link layout for the rear. Expect to see an unpainted carbon roof and more of the lightweight material possibly used for the boot and fender panels.