Maybe you have a bad mic. Ordinarily, the BMW hands-free microphone is the best in any car at any price. You might try checking the wiring connections at the phone module. Maybe there is a bad connection there. Finally, make doubly sure that the arrow embossed on the microphone is pointing forward toward the windshield.

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SOLD
2000 E38 750iL Highline Edition, Upgraded with the lastest 2006 X5 Electronics
MKIV Navigation, 16:9 Display, Bluetooth, TV/Video with Backup Camera, Sirius, and Aux Input

The mic is 5 years old. Maybe I will buy a new one and hope that works.

It is not uncommon for you to sound quiet on the other end. It is just the old technology in the E46 unfortunately.

Does anyone know if there is newer technology (bluetooth hands free kit) that be upgraded into the e53? A friend of mine bought the BavAuto kit and it sounds horrible. Anyone have any success stories to share?

Which BevAuto kit? The BMW OE kit is excellent by any standard. The sensitivity and noise canceling technology in the the mic and telephone modules are still better than any other car's BT system that I have tested. Many of the BevAuto kits use the Parrot system as the foundation. The Parrot is very cool, and it is a lot cheaper, but it does not perform nearly as well as the BMW OE system.

__________________
SOLD
2000 E38 750iL Highline Edition, Upgraded with the lastest 2006 X5 Electronics
MKIV Navigation, 16:9 Display, Bluetooth, TV/Video with Backup Camera, Sirius, and Aux Input

Yes, He has the Parrot based kit. The noise cancelling is very poor, and the volume on the mic is very low. He's stopped trying to get it to work.

Does anyone have the part numbers for the OEM kit, including any controllers and harnessing? The main controller is under the spare in the trunk right? I've got an empty compartment where the BT module should be so I would need it and the harness.

The problem I am having isn't me sounding quiet on the other end; it is all the background noise heard on the other end. Everyone says it sounds like I am in a wind tunnel.

There are two different systems, TCU or ULF based. They have some cost and feature trade-offs. Here is a great post that lists the key parts for both types of installations. Much of the additional installation and part selection details are located in posts both in this forum and the forum referenced by this post.
Consolidated Bluetooth ULF and TCU Parts Lists…

All U.S. specification and most other international market cars are pre-wired for phone. I think that the phone module is located in the compartment with the CD changer, nav computer, and DSP amp in the X5. I think that it is only the radio and Sirius module located near the spare.

__________________
SOLD
2000 E38 750iL Highline Edition, Upgraded with the lastest 2006 X5 Electronics
MKIV Navigation, 16:9 Display, Bluetooth, TV/Video with Backup Camera, Sirius, and Aux Input

This was a known issue and an upgraded microphone which helps with this is available. I installed the new mic and it made a world of difference. It was less than $25 from the dealer and is an easy swap. Hope this helps. I dont have the part number for the upgraded mic with me now but just ask the dealer to ensure that you are getting the upgraded one.

Nathan