ECUS, Turbos, just engine performance tech overall. I mean shit my ZL1 compared to 5th gen. Once my TB and blower come back from being ported I’ll probably be sitting at around 750whp, whereas you’d have to completely swap the blower in a 5th gen to get there

More advanced variable valve timing, direct injection, better/smarter fuel and ignition controls, way better manufacturing tools and techniques, and possibly the most important, better metallurgy and base materials.

Advancements in head designs, lighting fast yet smooth automatic transmissions, direct injection and port injection being used together, advancements in turbocharger designs, advancements in ECU technology

So I’m going to break from the crowd here and say its actually been possible for a long time. We’ve had the technology.

But what we have had:

• Competition among automakers driving the need to stay relevant
• Vehicle prices rising to the point where more “exotic” tech can start being mainstream
• Advances in control systems allowing higher HP engines to still meet fuel economy and emissions standards

Lets go back to the 90s. Ford would have never bothered with the DOHC 4.6 if they weren’t getting wrecked by GM’s LT1. The LT1 wouldn’t have been needed if the Corvette was competitive. The Coyote wouldn’t have existed if the 3V Mustangs weren’t getting wrecked by LS2 Camaros. I don’t think BMW wanted to start adopting turbo engines that much in the mid 2000s but they would have been down on power relative to competition at the time so they had to. Those are just off the cuff examples. Making power has never been the challenge, its meeting emissions and fuel economy standards while doing it.

The E46’s S54 is a fantastic engine but at the end of the day, its an 8000 RPM redline engine. Anybody could have shoved a set of big cams in a I6 with big head ports and short runners and made that power. The power isn’t the noteworthy part. To sell a car like that, you have to make the engine make the power while also being tame enough for street use, last the warranty period, and pass emissions standards. You can’t just do that in a temperamental big cam engine. Variable valve timing lets that be a reality, electronic throttle control probably helps, and then from there its just making an expensive engine built to handle high RPMs. It needs to have the rigidity, valvetrain control, oil control and bottom end strength to do it. That’s well established tech, its just more expensive than building a more basic engine not intended for such a rigorous life. The Honda B16 came out in 1989 and has similar power density, VTEC is what made it possible. VVT Tech existed since the 80s, manufacturers just were slower to adopt it on larger engines because it required R&D investment and they needed to have a need for it.

Modern spark and fuel control. Tighter tolerances inside the engine.

Each cylinder is sealed better than they used to be. So we are getting more out of the charge. A long with more advanced timing control of the cams along with spark.

The turbocharger becoming ubiquitous is just a bonus.

Cylinder heads

More air and more fuel in a shorter time, with better cooling.

Source: tuned my car from 250 to 550 bhp.

To this day it still impresses me that BMW made a production 3.2l 6 cylinder in 2001 that made 333-343hp especially compared to other production naturally aspirated 6 cylinders at the time. I do realize that if the E46 M3 would have come out today it would probably be SAE rated at around 310-320hp but its still impressive for a stock 3.2l engine.

Science!

Direct injection probably… but I don’t know if the E46 had that as well. Usually direct injection was reserved for diesel engines because of the extremely high fuel pump pressures needed.

Direct injection allows more even fuel air mixture for complete combustion and to prevent detonation as well as cooling air over the exhaust valves (since fuel is only sprayed in directly before combustion and the turbo will quickly push the combustion gasses out from the previous cycle).

The fact that it has 9.3:1 compression ratio plus turbos seems to indicate very high brake mean effective pressure which translates to power.

Variable Valve Timing has come a long way. More efficiency = more power with the same/less displacement.

In simple Thermodynamic terms, we’ve gotten better at putting more air and fuel mixture in a smaller space and exploding them more efficiently without destroying the engine.

Better materials, better engineering, better cooling, better air intake, and energy recovery methods all lead up to engines taking more air and fuel into a more compressed state and then harnessing that expansion of volume into mechanical energy.

It’s almost entirely down to the turbos. NA engines can only really be pushed so hard before they become full-on race engines with special high-octane race gas/ethanol and insanely high compression. Manufacturers can’t really get away with putting those into production cars because it’s impossible to warranty a race motor to 60k+ miles of daily abuse.

The only other way to make more power NA is by going bigger with displacement, but fuel economy/environmental regulations make that impossible for any large-scale manufacturer.

Engineer working in the automotive industry here.

I’d say mainly 2 things. Very fine control due to extremely powerfull ECUs and very tight manufacturing tolerances being economically achievable for mass production.

A modern ECU had immense control over all functions of an internal combustion engine, and can fine tune parameters litterally mid-combustion. The programms running in the ECU are very complex, can affect every part of the engine. And all those adjustmens happen in litteral miliseconds.

Let me talk with an example. In the mid-late 90s you started having ECU controlled port fuel injection. Most things until then if they needed some type of control, it was done mechanically. With cables, linkages, vacumm lines etc etc. There is not that much processing needed to control a 4 port injector. 10-15 sensors maybe.
Now go the modern ICE engine. You have… high pressure direct injection with piezoelectric injectors (allows multiple injections per cycle with fine control), electronically controll wastegate in the turbo, variable valve timing and lift. Oh and probably close to 300 sensors all around feeding data to the ECU. Literraly everything that moves, vibrated, heats or pressurizes, I can guarantee you it has a sensor that reads that. Plus a very complex SW that uses all these data to make adjustments in everything.

As for the manufacturing tolerances. Valves, piston rings, gaskets, turbine impellers/bearings. All things mechanical that move are manufactured more precise than ever. Also oils (and chemicals in general) are more advanced that ever. Today’s oil is nothing like the engine oil from 15 years ago.

There are a few things:

1. There is an entire network of computers in modern cars, monitoring everything from air/fuel mixture to tire pressure. Automotive engineers have far more data to play with than those from past decades.
2. Those computers and the network they’re connected to are significantly more powerful than in past decades.
3. Direct injection has gone from a novelty to a mature technology. Combined with optimized intakes, and an increase in the number of O2 sensors + some fine tuning of where they’re located, it’s much easier to dial in the perfect air/fuel ratio.
4. Direct ignition and some very advanced variable valve timing make ignition timing super accurate. That lets cars change ignition timing on the fly, which can really boost power down low & up high in the rev range.
5. Modern metallurgy + all the other changes have allowed for much higher compression ratios without risking detonation.
6. As others have mentioned, turbos! Modern turbos produce power over a much wider rev range & tend to be tuned to produce peak power lower in the rev range, making the car feel faster in daily driving scenarios.

I’m an old school gearhead and will always miss the cars of old, but modern cars are truly a marvel. We’ve taken something that is smokey, oily, and a gross polluter and turned it into something that’s hard to smell even when you stick your face near the exhaust*.

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* I don’t recommend trying this