BMW is considering building an electric car as well as a number of new models for megacities as the world’s biggest luxury carmaker tries to boost its environmentally-friendly offering.

The German company will make a decision on the electric car this year after concluding it was technically possible. It has also set up a group – Project i – to examine what cars and services it needs for people living in very large cities and that could lead to the creation of a fourth brand alongside BMW, Mini and Rolls-Royce.