Headed up the freeway at 110-120 kilometres an hour in our 94 540I - after about an hour I think I detected a slight roughness in the engine and then we noticed a pungent odor. Pulled over to investigate. We found smoke streaming from under the left rear wheel arch. Opened the boot and more smoke from the left rear floor of the boot (trunk). The floor of the boot was too hot to put your hand on on the left side just left of the spare tire well. My first thought was that we had left the parking brake on or it had stuck but upon examination it was off, the brake area and wheel were not hot and the rear of the muffler was discolored and the front of the muffler was cooler while the back of the muffler was very, very hot. It appeared that exhaust was coming out of both pipes although I don't have enough experience to say if it was coming out at normal pressure. We decided the prudent thing was to load the car on a flatbed and carry it home. Too many wires and computer gadgets and a big gas tank adjacent to all that heat. The car is headed to the shop tomorrow - I fear they'll scratch their heads and replace a bunch of parts using the shotgun method. Anyone here have any ideas or suggestions?