Those creative Bavarians -- calling their first car an M1 just because it was, well, the first M car. Thirty-some years later, that inspired deviation from BMW's naming norm has cost the newest M car the name it should have had. So if you think today's 1-series M coupe is awkwardly named, blame the 1978-1981 BMW M1.
In the 1970s, BMW's newly formed racing subsidiary was toying with the idea of entering Formula 1. Instead, the company decided to enter Group 5 -- a series that kept the racing cars closer to the road cars. Or rather, required the models to be sold to the public -- a minimum of 400 cars -- to be eligible to race.
Unfortunately, the development of the M1 was a bit of a disaster. The spaceframe chassis was engineered by Lamborghini, which was to build the car -- except the Italians were tremendously delayed by a little problem called bankruptcy. The Italians eventually completed the engineering but never built any cars. BMW finally enlisted coachbuilder Baur to assemble the M1, which consisted of pieces from seemingly everywhere, including fiberglass body shells produced by Giorgetto Giugiaro's Italdesign. (Giugiaro himself designed the M1, but it was effectively only an update on Paul Bracq's 1972 "Turbo" concept car.)
The engine came from BMW Motorsport GmbH. It was M's first production engine, a 3.5-liter straight six making 277 hp. In the 3100-pound M1, that was good for a run to 62 mph in 5.6 seconds and a jaw-dropping 162-mph top speed. In racing trim, the straight six made 470 hp (at 9000 rpm!) and was good for almost 200 mph. Unfortunately, by the time the M1 entered production it no longer met Group 5 regulations and couldn't be raced in that class. Undeterred, the creative types in Munich invented a series where the M1 could race against itself. It won! Fancy that.