2 reasons, in the main... (more) (archive)

1 - the most important reason is that they havent needed to. They have not needed to squeeze the engine into that small a package, because they haven't built fwd cars. And they don't do fwd because they don't cater to that market, their preferred market either prefers the "cachet" of a BMW name, or wants rwd and is willing to spend extra to get it.

2 - no extra money. BMW is smaller and has less extra money to spend. So they spend it where it gets the highest return, which is in adding gadgets and luxury stuff to their cars, and in getting more power out of the engines they currently produce. If they decided to do a V6 they would need to spend lots of money solving issues that either don't exist in the inline 6 design, or that they already paid to resolve in the inline 6 design.

Now that they make the "New Mini" you may see them do it. Their typical strategy has always been to introduce a model with low power, then once they have picked up the available sales at that level, and to encourage trade-ups, they add power and features. The Z3 is the best example of that strategy, but others abound.

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