BMW N63 vs Mercedes M278: The $20,000 Question

You’re shopping for a used luxury sedan with a twin-turbo V8. You’ve narrowed it down to two options:

BMW 550i / 750i / X5 / X6 with the N63 V8 (400-445hp)
Mercedes S550 / E550 / CLS550 / GL550 with the M278 V8 (402-449hp)

Both are hot-V twin-turbo V8s. Both are Alusil aluminum blocks. Both have catastrophic failure modes that can turn a $20,000 used car into a $30,000 repair nightmare.

This guide breaks down exactly which engine is more reliable, which is cheaper to own, and which you should buy.

1. The Engines: Architecture Comparison

Feature	BMW N63	Mercedes M278
Displacement	4.4L (4,395cc)	4.7L (4,663cc)
Configuration	90° V8, DOHC, 4 valves/cylinder	90° V8, DOHC, 4 valves/cylinder
Turbo Layout	Hot-V (turbos in the V)	Hot-V (turbos in the V)
Bore Material	Alusil (aluminum-silicon alloy)	Alusil (aluminum-silicon alloy)
Fuel Delivery	Direct Injection	Direct Injection
Power Output	400-445hp	402-449hp
Production Years	2008-2016 (N63), 2012-2019 (N63TU)	2011-2017

Verdict: Architecturally, these engines are nearly identical. Both use hot-V turbo layouts and Alusil bores. The differences are in the details.

2. The Major Failure Modes

BMW N63: Valve Stem Seals

The N63’s signature failure is valve stem seals. The seals dry out and crack, allowing oil to seep into the combustion chamber.

Symptom: Blue smoke on startup, oil consumption (1 qt per 600-1,000 miles), fouled spark plugs.
Frequency: VERY HIGH. Nearly all early N63s (2008-2013) will need valve stem seals by 80,000 miles.
Repair Cost: $5,000 - $9,000 (requires cylinder head removal).

[!WARNING] BMW issued a Customer Care Package extending warranty coverage for valve stem seals on early N63s. If the car is out of warranty, you’re paying out of pocket.

Mercedes M278: Cylinder Scoring

The M278’s signature failure is Alusil cylinder scoring. The bore surface degrades, allowing metal-to-metal contact.

Symptom: Rough idle, misfires (cylinders 5/1), blue smoke, low compression.
Frequency: MODERATE. Techs report seeing scoring on “nearly all M278/M157” by 100k+ miles if you test carefully, but not all engines show symptoms.
Repair Cost: $10,000 - $20,000 (long block replacement).

[!WARNING] Mercedes does NOT cover cylinder scoring under warranty. They consider it a “maintenance issue.”

Verdict: The N63’s valve stem seal failure is more frequent but cheaper to fix. The M278’s cylinder scoring is less frequent but catastrophically expensive.

3. Secondary Failure Modes

BMW N63

Timing Chain Stretch: Early N63s have timing chain stretch issues. Repair cost: $3,500 - $6,000.
Turbo Failures: Hot-V turbos run hot and fail. Repair cost: $3,000 - $5,000 per turbo.
Carbon Buildup: Direct injection causes carbon buildup. Repair cost: $800 - $1,500.
Injector Failures: High-pressure fuel injectors fail. Repair cost: $1,500 - $3,000.

Mercedes M278

Timing Chain Tensioners: Early M278s have tensioners that bleed down at cold start, causing a rattle. Repair cost: $1,500 - $6,000.
Turbo Coolant Lines: Plastic coolant lines crack and leak. Repair cost: $800 - $1,800.
Oil-Coolant Mixing: Oil cooler seals fail, mixing oil and coolant. Repair cost: $1,500 - $3,000 (or $10,000 - $20,000 if bearings are damaged).
Carbon Buildup: Direct injection causes carbon buildup. Repair cost: $600 - $1,200.

Verdict: Both engines have expensive secondary failures. The N63 has more failure modes (valve stem seals, timing chains, turbos, injectors). The M278 has fewer failure modes but each is expensive.

4. Cost Comparison: 100,000-Mile Ownership

Here is a realistic budget for owning each engine from 50,000 to 150,000 miles:

BMW N63

Mileage	Expected Repairs	Cost
50k - 60k	Carbon cleaning, ignition coils	$1,500
60k - 80k	Valve stem seals	$7,000
80k - 100k	Timing chain tensioners	$4,500
100k - 120k	Turbo replacement (1 turbo)	$4,000
120k - 150k	Injectors, misc leaks	$2,500

Total (50k - 150k miles): $19,500

Annual Average: $1,950/year

Mercedes M278

Mileage	Expected Repairs	Cost
50k - 60k	Timing chain tensioner check valves	$2,000
60k - 70k	Carbon cleaning, ignition coils	$1,400
70k - 80k	Compression test, turbo coolant lines	$1,500
80k - 100k	Oil cooler seals, spark plugs	$2,000
100k - 120k	Transmission service, brakes	$2,500
120k - 150k	Injectors, misc leaks	$2,000

Total (50k - 150k miles): $11,400

Annual Average: $1,140/year

[!CAUTION] If the M278 develops cylinder scoring, add $10,000 - $20,000 to the total.

Verdict: The Mercedes M278 is cheaper to own if you avoid cylinder scoring. The BMW N63 has higher guaranteed costs due to valve stem seals and timing chains.

5. Frequency of Catastrophic Failure

BMW N63

Valve Stem Seals: VERY HIGH (nearly all early N63s by 80k miles).
Timing Chain Stretch: MODERATE (common on early N63s, less common on N63TU).
Turbo Failures: MODERATE (hot-V turbos run hot).

Mercedes M278

Cylinder Scoring: MODERATE (techs report seeing it on “nearly all M278/M157” by 100k+ if you test carefully, but not all show symptoms).
Timing Chain Tensioners: MODERATE (early M278s, fixed on 2015+ models).
Oil-Coolant Mixing: LOW (high-mileage issue, not common).

Verdict: The BMW N63 has more frequent failures. The Mercedes M278 has less frequent failures but each is more expensive.

6. Preventability

BMW N63

Valve Stem Seals: NOT PREVENTABLE. It’s a design flaw. All early N63s will need this repair.
Timing Chain Stretch: PARTIALLY PREVENTABLE. Short oil change intervals help, but it’s still common.
Turbo Failures: PARTIALLY PREVENTABLE. Avoid aggressive driving when cold.

Mercedes M278

Cylinder Scoring: PARTIALLY PREVENTABLE. Short oil change intervals (5,000 miles) and proper warm-up habits reduce risk.
Timing Chain Tensioners: PREVENTABLE. Buy a 2015+ model with updated tensioners.
Turbo Coolant Lines: PREVENTABLE. Replace proactively at 80,000 miles.

Verdict: The Mercedes M278 is more preventable with proper maintenance. The BMW N63’s valve stem seal failure is inevitable.

7. Which Should You Buy?

Buy the BMW N63 IF:

You are buying a 2016+ N63TU (improved valve stem seals and timing chains).
You can afford a $2,000/year maintenance budget.
You have a trusted BMW specialist nearby.
You get valve stem seal replacement verification (if already done, the car is much safer).

Buy the Mercedes M278 IF:

You are buying a 2015+ model (updated tensioners).
You can afford a $1,500/year maintenance budget.
You have a trusted Mercedes specialist nearby.
You get a compression test (all cylinders 150+ PSI) and no cold-start rattle.

8. The Verdict

If you want the safest long-term bet: Mercedes M278 (2015+).

Why?

Lower annual maintenance costs ($1,140/year vs $1,950/year).
Fewer guaranteed failures (N63’s valve stem seals are inevitable).
More preventable with proper maintenance.

BUT: The M278’s cylinder scoring is a catastrophic risk. If it happens, you’re looking at a $20,000 repair. The N63’s valve stem seals are expensive but predictable.

The Smart Buy: Mercedes M278 (2015+) with a clean compression test and no cold-start rattle.

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