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I believe him. There is absolutely no reason for FWD high performance BMWs when their small vehicle architecture supports AWD. And, at least based on the quotes taken from this particular interview, Flasch did not rule out the latter configuration.
That being said, I think the ship has essentially sailed on this. By the time BMW M got their house in order and developed a worthy "S48" (400hp is the price for entry in the segment) and a chassis that was matched to it, the momentum will likely have shifted to dedicated rear-motor, RWD BEV architectures for small, premium performance cars.
For example, it is all but certain that we will see VAG produce MEB-based performance offerings from Audi and perhaps Porsche as well by 2030. BMW would probably not have their hypothetical FAAR-based ICE M vehicle ready until, say 2025. It doesn't make sense to go through the exercise for a one-generation-and-done product. Instead, they should (and likely will) start readying a small premium RWD BEV lineup, including high performance variants, possibly in partnership with Mercedes, for release second half of next decade.
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