Here is what my brother and I have planned out. Keep in mind, this has a little bit of research but is so far only a rough idea of what I am considering trying to do. By doing as much as possible myself, I think I can keep the costs reasonable, but even paying someone to do some of the work, you can do similar without going into serious debt. No matter what, expect to put more into the engine/turbo setup than you currently have in your entire car.
Me, I plan on getting a decent Tig welder and a cheap mill (Harbour Freight $1000 or a used Bridgeport check your local paper, you would be amazed!). With these 2 peices you can do an awefull lot of this in your garage. Some of this can be done with very common tools even. Research before you go start spending though.
This is not perfect, nothing has been attempted yet, and only minimal initial research on it has been done. So do not take this as a recipe that anyone can follow. So do not be too harsh or critical of it. Considering this is just a rough draft of things brainstormed over time, I know things are missing.
Long block.
Block
The plan is to start with a used e36 m42. Reasons for this is that it is newer, and had more development time. It also has a built in knock sensor, and I am pretty sure the heads or cams are slightly better. Though I admit, I am sketchy on that part. Deburr, smooth and generally clean it up. Increase and clean out the oil galleys, enlarge the oil return holes. Maybe add a small bit of block fill in oder to stiffen the bylinders a tad (racers trick). Bore the block, may not get much, but if you need custom pistons anyhow, why not. Also o-ring the cylinders, this will give you a far stronger headgasket. Something really needed for boost. As long as you do the deburring and minor machining, this can all be done pretty cheap. No more than a couple hundred.
Pistons
These will need to be custom plain and simple. Forged, oversize, and 9 or 9.5:1 compression.
Rods/crank
Stock. deburred, smoothed. No need to mess with these really. They ae good parts already.
Heads.
Cleaning up the bowls is the most important factor. However some work on flow would be good, particularly the exhaust. Problem here is that BMW Motorsports division already breathed on the M42, so you may not get much. Extrudehone is the best bet for better flow but it is expensive. Probably $200-$400 for the single head.
Cams.
Some quick research and playing on a simulator dyno will net the best cam specs. Could even just get the Schrick specs. Take these and get the cams reground. This tends to run between $200-$400, much better than Schricks. You especially need more exhaust.
Lifters/buckets
May want to convert to solid.
Harmonic balancer
Custom. There are companies who will make them to your specifications.
Doing all of this should net you a VERY solid bottom end, capable of 8000 or more RPM.
Exhaust
Cutting up a stock exhaust is the easiest way to get some of the necessary exhaust parts. A turbo flange is easily fabbed and welded. [b/Beware!]/b] I have heard of basically highway robbery by shops making turbo header flanges. As in $800 just to flip a header and weld on a flange! $200 for teh turbo flange.. etc.. What the fuck are people doing, getting gold plated flanges? It is a plate with some holes in it. Do not fall prey to this. A good shop can just about build a whole header with flange for that price. Supra guys seem to get raped the worst, though we drive Bimmers, do some shopping around.
A custom downpipe will connect back into the orginal exhaust, which may need to be increased in size a bit. Beware, downpipes suffer the same fate as turbo headers/flanges.
Turbo
Spec-wise we have several factory turbos to chose from.
A Thunderbird turbo coupe turbo would be a bit large, though capable of a bit more power. It would give you that rush people love from turbos. Problem is, that is a bad thing for a fast car. You want power to come of smooth over a wide range, not hit like a brick.
A Golf/Jetta or Audi TT turbo would be great.
Placement is an issue. One place I have found it could work well though is right where the windsheild washer resevoir is. This means you need to move/replace that, but that is a small issue really. Another place is the battery tray Cabriolets use next to the firewall. I do not recomend this though. Mor ethan a few cars have gone up in flames due to firewall insulation catching fire due to the heat of a turbo. If you tryto mount it near the firewall, do us all afavor, carry a fire extinguisher in the car. It will probably not save the car, but it could save you.
I also recomend ceramic header wrap and/or ceramic coating of the exhaust pipes and turbo. BMW's are not known for low underhood temps. This will help keep them down some.
piping/intercooler.
By switching to an electric fan, you remove HP loss from the engine, as well as make some space for a crossover tube. My plan is to use an inline water to air cooler sitting just in frot of the engine, over what would have been the stock fan. The water to air, allows more efficient plumbing, less lag, and allows you more freedom in mounting the cooler considering it does not need huge pipes going to and from in any specific place, not to mention water is a better at removing heat than air to air.
Switching to a new M5 water pump could also help, though adapting it could prove to be a challenge. It can be remote mounted as it is electric.
Intake
This is something I have been wanting to mess with for a while. I dislike some of the response of the stock engine, so... I.T.B.'s.
The idea is custom made slide valves. One plate each side, making a scissor action for throttle openings (hard to explain). Look up slide valve carburators for a simple explanation. This uses dual slides in opposite directions. The linkage could be a pain, but the response should be great. The total length of each should be be short, like 8in maybe with the valves at the 3-4in mark.
Even if you do not build an intake like this, the stock one can be utilized, you would need to improve flow and come up with some piping to adapt it.
injectors
Cutting up a GM or Ford intake will net some fuel injector bungs allowing for a wider variety of injectors. As well as the ability to run dual injectors per cylinder for a more adjustable fuel curve.
computer/injection
Megasquirt... BMWMAN91 has already accomplished a lot for M42 guys as far as this goes. It is at least a starting point for N/A.
Power output....
Edumacated guesses..
300-350 with the smaller turbos.
350 -400 if you do not mind some lag should be possible.
More if you really do not mind a pretty rediculous powerband, in other words, spinning the tires everytime the turbo kicks in.
Considering our vehicle weight, this would make for a very fast car. 11sec. 1/4 mile would be pretty easy to rip off back to back to back with the 300-350 setup.
Some other issues to address due to such a power increase:
Chassis, probably could use stiffening.
Lighter flywheel.
Brakes could use improving. M3 brakes maybe?
Radiator. A larger radiator will be necessary. One without a plastic resevoir is recomended.
Rear End. You should drop in the 325 (medium) differential. For the higher HP setups a large (750i) rear end should probably be used.
