text: does bhp in motor vehicles indicate the engine power? i hear about bhp in every motor vehicle. what is it? does it indicate the power of engine? and what is rpm? how does it affect the performance of the vehicle? it depends on who is rating it and for what purpose.   generally hp is rated at the wheels. this rating is actually ~20% less than the engine hp because of transmission losses, rolling resistance etc.  all things being equal the more hp the more power the vehicle will have, however more power does not necessarily mean speed especially while getting up to speed and for passing.  torque is actually more important than hp for speed. a high torque engine is preferred over a high hp, low torque engine. the lower the rpm the engine needs to turn  to obtain maximum torque the fast the vehicle will be able to accelerate and the more efferent the vehicle will be... this is why low hp diesel engines can pull heavy loads... diesels generally have several times the amount of torque of a similar hp gasoline engine and their torque is developed at lower speeds (rpm) than gasoline engines... that is one reason diesels are so fuel efficient vs gasoline engine...  hope this helps.