A conflict inside the manufacturer: M-Cars vs. M-badged cars

There are several BMW models which BMW Motorsport made changes on, without them becoming full M-Cars e.g. BMW 530i M-line packet or 325i M-line packet etc. Vehicles which have been modified by BMW Motorsport, but are not full M Cars, may feature plain "M" badges with no number, whilst full M Cars will have "M" badges with the model number (e.g. "M3" or "M5"). One exception to this is the M Coupe model, both Z3 and Z4 variants, which only have on the boot a plain "M" badge with no number displayed. These cars are full M Cars.

In recent years, there have been M Sport packages (which is more expensive than the regular Sport package) and other M-badged accessories available on non-M cars, usually as factory options. Examples of this include the E46 3 series, in which the performance package option upgraded the car to include M68 style rims which had small M badges below the BMW Roundels, while the E39 and E60 5 series sedans had optional aerodynamic packages that included strongly influenced M5 styling (for example bumpers). It is not unusual to see "standard" BMW's with "M" badges or ribbons accenting the design. Simply look at the tachometer, without the M mark and the 300 km/h it's not an M5 E34.

The plain ///M Badge simply stands for M-tech upgrades on the car, suspension, brakes, looks or any other mod that has been developed by the ///M division. So therefore the ///M badge should not under any circumstances be compared to the ///M+number badge (except the Z-cars, as mentioned), as they are not plain M-cars, just M-equipped. In Europe for example, they have had these ///M options on the regular cars since the late 70's. Therefor you will also see many cars from Europe that carry these ///M-badges from factory.

The 2011 BMW 335is is considered an M-badged and enhanced car, although not a full M-car. The 335is has a more powerful engine than the regular 335i, plus the front bumper intake and rear exhaust manifold influenced by the M3, and an optional M dual clutch transmission instead of a automatic transmission. The same engine is also found in the 2012 BMW 1 Series M Coupe, which is considered a full M car.

Source: http://en.wikipedia.org/wiki/BMW_M