Very well known failure, just search for "BMW Z3 subframe failure". it is a design flaw by BMW that affects a lot of Z3's through all model years. Mine started to pop one weld at 88K miles. It can cause the rear alignment to be off, in worst case the trunk floor is torn out and the differential falls to the ground. Clunking from the back while shifting in the first two gears is one indicator this damage is not far away. This is one forum thread that describes the issue well: Https://www.bimmerforums.com/forum/showthread.php?1979601-subframe-trunk-floor-differential-mount-failure

- Austin, TX, USA

The rear differential housing is separating from the subframe of the car, under or near the trunk area. This is a well documented issue with the Z3 series of vehicles. This could be a safety hazard while operating the vehicle if the read differential separates from the subframe, and could cause a hazard to other motorist. This appears to be due to a design flaw. The frame was designed for a 1.9L engine, and BMW did not redesign the subframe to allow for the larger engines it later sold in the Z3 series of cars. BMW also had this same issue on 3xx series of vehicles, and agreed to repair those cars due to a class action law suite settlement. BMW should be held accountable for the design issue, and acknowledge the safety hazard.

- Simpsonville, SC, USA