Someone posted a really good summary of how the EWS works with cranking/starting maybe see if you can find that. I think it's different for the V-8s and might be different for facelift/pre as well so that's something to check into. You should really have went with a full key but I guess you will find out if you need an ignition switch this way as well. If the ignition switch has never been replaced then it won't be wasted money to replace it regardless.

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1988 325is (purchased new) sold
2004 X5 3.0 2005 X3 2.5
2008 X5 3.0 (new to me)