FRANKFURT-- BMW AG will give a new electric-powered city car a lounge feel with bench seats, naturally tanned "mocha brown" leather and hemp fibers in the floor covering to hold off Audi.
BMW for the first time showed concept versions of the i3 electric city car and the i8 hybrid supercar in Frankfurt last Friday.
CEO Norbert Reithofer said the i8 will cost more than 100,000 euros ($143,000).
The models, developed from scratch, will anchor BMW's new "i" sub-brand.
"The majority of current electric vehicles are so-called conversions of traditional vehicles but conversions are always compromises," development chief Klaus Draeger said. "We wanted to bring e-mobility to the streets without compromise."
BMW is betting that the 530 million euros ($756 million) investment to set up production of the vehicles will pay off in the race with Audi, which overtook Mercedes-Benz this year and has vowed to topple the Munich-based carmaker as the luxury-car leader by 2015.
Initial volumes for the models could be in the "tens of thousands," with the potential to grow rapidly depending on market and regulatory developments, sales chief Ian Robertson told Bloomberg TV.
"If the project is successful, it will give BMW an edge in innovation, which is a key attribute for premium car manufacturers," said Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisberg- Essen. "It would be a difficult situation for Audi."
Both of BMW's electric cars are built around a carbon-fiber frame and an aluminum underbody to lower weight and consequently reduce battery costs.
Investments for the project include a new carbon-fiber factory in the U.S. and a 400 million-euro expansion of its factory in Leipzig, Germany. The i3 will go on sale in 2013, followed by the i8 in 2014.