[mmmmm235i]

This is just an odd statement when BMW is not even in the business of building a pure sports car. As others have said cars like the corvette continue to sell well because they are much more focused. If you can have a flashy weekend car that can hang with just about anything on the road for 60k, why would you shell out 80k for an m4 with less power and less aggressive styling for a weekend car. Others have correctly pointed out that those buying a weekend car usually are driving an SUV or larger sedan most of the time, which BMW sells and builds really well. When it comes to comparable sedans and SUVs, BMW is pretty much on par with other brands with similiar offerings. BMW has followed other brands and have continued to make bigger and bigger cars. BMW makes sporty and some performance oriented daily drivers, but no full on sports car. As others have pointed out the z4, tt, and slk do not compare to caymans or boxsters at similiar price.
I think the M2 is slotted to fill this role for BMW and is extremely important to maintaining the brand's reputation for sport offerings. I drive an m235i and you can get out the door with a pretty nice one around 45k. This car offers more practicality and more power than a roadster and the M2 will certainly be even better. The M2 should come in at a price around a corvette and will hopefully offer similiar performance and aggressive enough styling to be a great car to play with on the weekends.
The fact is no one wants an impractical 2-seater that doesn't perform and is too expensive to be an extra car.
It is fine for BMW to admit that its bread and butter is a mix of performance and luxury and building a pure sports car is unimportant to them, but to say that the market is gone is just not true. I think for the right price there are also enough people like us who are willing to have a rough daily drive to have a car that can really perform, but the z4 is not that.