GOOD LUCK! This thing is a nightmare to try to disassemble.

I had the exact same issue.

I pulled an armrest assembly from a junk yard. Since my X5 didn't have the cellphone mount I didn't need any of the wires in my arm rest. So I just clipped them on my junk yard find then cleaned the wires and phone mount out when i got home.

To pull the assembly, you remove the screws from the hinge mount from inside the storage compartment and then i think there are also 2 screws that you access through the rear passenger vents.

The easiest way to do this is to use your new to you arm rest and just switch the top leather cover over to it. Trying to disassembly the arm rest mechanism will leave you with broken plastic pieces. I know this because I had to go back to the junkyard twice to get a second arm rest assembly. The screws for the top cover are under the little rubber bumpers/screw head covers on the bottom of the lid. If you decide to remove the pin from the top cover hinge, I suggest trying to pull the pin with needle nose pliers rather than drive it through. It's actually 2 pins.

Good Luck!

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2000 E53 M62