I don't believe that the manual covers an occasional 'trans failsafe prog' error, nor does it explain how to fix it, or exactly what might be wrong with it. I would appreciate it if you did not make snarky comments, that carry no value. Maybe I am missing something, but I doubt this issue is covered in my manual. Please point me in the right direction.

Guys - I mentioned the Speed Sensor because the OP mentioned inoperative Speedometer, cruise and such. I know someone who had same symptoms on an E38 and it turned out to be frayed wires on that particular Speed Sensor. Usually on these era BMWs, when things like the Speedometer and Cruise control stop working it's because the Speed Sensor is no longer sending a signal.

With the additional information about the intermittent SES and TFSP warnings, I would suggest either load testing the battery or checking the alternator / battery voltage by opening up the cluster and doing a voltage check.

These cars do not take kindly to weak or faulty batteries.

I checked the battery voltage at idle, it is at a steady 13.5v. It is about 14 while driving. I do not suspect this to be enough to cause an issue with speedometer. I have never had any trouble with starting the car. I might just give in and take it to a stealership and pay them to figure it out and fix it.

Hmmm... well, that would eliminate the battery as the potential culprit.

Checking the Speed Sensor is zero cost, why not try that first? Even if you decide to buy / replace that sensor, you can get it for around $100+ from vendors like Autohaus - Link:Your Parts Search Returned 1 Part(s)

You can also get it from FCP Euro - Link: BMW Wheel Speed Sensor Rear (X5 E53) - VDO 34526756380V | FCP Euro

Also from OEMBIMMERPARTS - Link: BMW X5 ABS Speed Sensor OEM 2000-09/2003

As far as I know, dealers will charge you about $150 just for diagnosis or to scan your car.

you need to read the codes... a faulty speed sensor can indeed cause plausibility error which will set tranny into faillsafe... somehow, the tranny is not always in the failsafe but the engine got the light on which stays on... this can point to a frayed wire... in absence of a diag software, if you are familiar with multimeters, you can try to measure the speed sensors... they are essentially diodes, resistance in one direction, no resistance in the other direction... you can measure the sensors right at the wheels, take one out at a time and measure it - time consuming, or you can measure all four of them right at the ABS connector - i would suggest this route, as you will find the culprit right away, then you can pull the specific wheel, to measure the actual sensor - sometimes, the sensor is good, but the wiring between the sensor and the ABS is not... it will save you a lot of money and aggravation... or, you can always can have the dealer feed you a line of BS at your expense... :)

good luck...

Thank you very much. I will check them all with a multimeter at the ABS connecter.

Thank you very much

ECS Tuning
German Auto Parts dot Com
AutoHausAZ dot com

All great places to get OEM or OEM equivalent parts at lower prices than the Stealership.