Thanks for the response.

Your analysis is spot-on and I have noticed the noise under the conditions described.

rh71,
how did you get the dealer to reproduce it? In my case it only happens when it is really cold outside and car has been parked for a while. I have had my X5 at dealer for 3 days and he says he can't reproduce it. I showed him the SIB and he agreed with it but he says he still has to reproduce in order to move forward and make a warranty claim. little frustrating!