this item is NOT compatible with onboard electronics of an E53 based BMW X5.

It may perhaps function as a stand alone system on an aftermarket tow hitch installation but it has been noted on this forum by members who actually towed things from a bicycle rack to a 6000 lbs boats that nothing but the Original Equipment (BMW branded) tow package, that already comes with electronic control, should be installed onto the E53 vehicle...

the tow control unit from BMW incorporates the towing package into the rest of the car and supplies the towed trailer with monitored voltages for the lights, tells the rest of the car, when a trailer is hooked up (by means of the trailer lights connected to the car via harness) and the car's air suspension and rear PDC are disabled... the trailers lights are monitored for burned lights... overall, better integration...