A Limited Slip Differential Makes My BMW 128i As God Intended

I’ve always remarked that rear-wheel drive BMWs love oversteer. There’s just something about the way the rear-end progressively and predictably steps out, and as long as you’re committed to powering out of it, they usually get right back into line. Though, there’s one big caveat to this driving impression—this only happens if they’re equipped with some form of a limited-slip differential.

My 2011 128i has three charming characteristics that are classic BMW: a fun, naturally aspirated inline-six engine, hydraulic steering that’s wonderfully communicative and weighted, and rear-wheel drive. However, the latter is severely lacking as it’s equipped with a woeful open differential, meaning it’ll put down the power, but in a very poor, non-performance-minded fashion. It’s got what’s considered an e-differential, meaning the ECU (er, DME as BMW calls it) will actuate the rear brakes to sort of simulate a limited-slip, but it’s utter garbage.

Therefore, to make my BMW handle the way God intended, I threw down some fat stacks of my own hard-earned cash and bought a Wavetrac limited-slip differential.

The Gear

At first, I thought about just buying the differential unit and installing it into the differential housing with fresh bearings and seals myself. I’d save a lot of money and it’d be a very valuable learning experience.

However, when I read up on what was involved, I got cold feet real quick. A Wavetrac costs $900 at the cheapest, before tax and shipping and I didn’t want to potentially mess up a small-yet-costly part of the installation process and be out that kind of scratch.

I decided to throw down and buy an assembled unit from BimmerWorld—who partner with popular differential shop Diffsonline—and have something that I could unbox and bolt right up without issue. I could also take comfort in the fact that a shop that does this kind of work all-day-long did it properly. Plus, after all their inspecting, cleaning, and prepping, plus painting the housing, it’s like receiving a brand-new unit direct from Bavaria.

The only aspect of the assembly I’d be responsible for was attaching my 128i’s old housing cover with silicone sealant, torquing the bolts down to spec, and filling it with fresh gear oil.

I decided to go with a Wavetrac as I’d read excellent reviews, they’re maintenance-free, made in the USA, don’t make any additional noise, and the way they maintain drive when a wheel is unloaded is pretty darn intuitive. It seemed like the best all-around option. I also maintained the factory final drive ratio of 3.23 as I dig the car’s factory gearing as I can cruise at speed on the highway and not have to crank the stereo’s volume up too high.

Prepping For the Job

BimmerWorld originally reported that there was an eight-to-ten-week lead time, however, I received it a tad quicker than that. And thankfully, uninstalling and reinstalling a differential in the 128i only requires a couple basic tools—mainly an E Torx socket and open wrenches—however, I bought some things to make life a tad easier.

I don’t have a workbench in my garage yet, so I bought a sturdy folding unit to fill the gap. I’m tired of doing assembly on my driveway, so this would make cleaning, prepping, and attaching the diff cover, as well as filling it up and torquing the bolts, far easier. I also bought a few small blocks of wood to keep it supported and stable.

There was also an initial thought of buying a transmission jack to keep the 75-pound unit nice and supported while installing it. But I decided to instead balance it on my trusty 1.5-ton Harbor Freight floor jack. This method actually ended up being much easier than I thought it’d be.

Removal

Like all slightly intimidating jobs, I gave myself an entire day to do the swap. I also intended on replacing the differential bushings, however, the tool I bought to pull them out didn’t fit in the extremely tight space, so I’ll have to attack those at a later date. Thankfully, the ones that were in there were still in very good condition.

The same goes for the subframe bushings. I had some bushing reinforcements on-hand from the 128’s previous owner, but it took so long just to swap the diff and my neck, shoulders, and back had gotten quite sore. Swapping will occur at a later date. I’ve read that it’s an hour’s job and you don’t have to remove the diff to do it. These are an effective upgrade as they make the car feel overall more confident and taut, and according to fellow 128i track enthusiasts, help extinguish understeer on track.

The process of pulling the factory diff was simple, it just took a very long time on account of being in very, very tight quarters. All of the E12 bolts that attached the CV axles and driveshaft to the diff came off easily with a breaker bar or impact, but it was a pain to get the socket on properly with the CV boots in the way. Then, even after moving some heat shielding out of the way, there was barely any room to get so much as a box-end wrench on some of the diff mount bolts. Plus, I was working solo.

Before I fully removed one of the front bolts and the single rear bolt, I positioned a jack underneath so I could slowly bring it down gingerly. My aim was accurate and it slid right down.

Installation

Once I had the iron lump out, I threw it on my new table, drained the disgusting old gear oil into a drain pan, and buzzed the cover bolts off with my impact. A knock on the back of the cover with a hammer freed it from its factory silicone sealant. I proceeded to clean up the cover really well inside-out, taking my time with brake cleaner, citrus oil cleaner, water, and a brass brush.

I then moved the old diff out of the way, put the new diff in its place, and poured in the correct amount of recommended 75W110 full synthetic Red Line gear oil.

Up next, I dried the cover thoroughly and ensured there was no leftover residue on the inside. I then laid a thin bead of Reinzosil on the mating surface, ensuring it was thin enough to do the job, but not glob up inside once it was torqued down. Finally, I reinstalled the drain plug, reinstalled the bolts finger-tight, and torqued them all to spec in a criss-cross pattern. Installation went far smoother, as it only took one repositioning with the jack to get the diff into the right spot to thread the first bolt through. I then took my time threading in the other two and followed up by torquing all of them to spec.

Reinstalling the E12 driveshaft and CV axle bolts took a while, though, as I had to keep getting up to put the car in and out of gear to hold the driveshaft in place. But with some patience, I had all sixteen torqued down properly.

Done and Dusted

Diffsonline recommends a sturdy, easy-going break-in period to ensure everything seats properly. That means I haven’t had a chance to drive the 128i too enthusiastically just yet. It’s been incredibly hard to resist, to say the least. Once the break-in period is over, I’ll drain the fluid and refill with another serving of fresh full-synthetic Red Line.

That said, the hints I have been getting so far have been intriguing. The car just powers out of corners noticeably better and feels all-around quicker. This has been one hell of a follow-up modification since swapping in the three-stage intake manifold, and I can’t wait to experience the fruits of my labor on track in the near future.

I might also, for the sake of education, buy a cheap junkyard 128i differential and restore it with fresh seals, bearings, and the works. I’d leave it open, but I’d break out a dial gauge and go to town. My colleague Hank O’Hop said it’s a worthwhile thing to learn if I’m going to do more diff swaps, which I certainly plan to do for future cars, so might as well build up a spare as a learning experience.

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