BMW has confirmed it will create a new sub-brand to sell its most environmentally friendly vehicles under.
The brand will operate in a similar way to BMW's "M" label for its high-performance cars, according to company chief Norbert Reithofer.
A BMW statement said: "The Board has now decided: This auto will be launched on the market as a sub-brand of BMW. As BMW is the innovation driver within the Group, the decision for a sub brand under BMW is the most logical step. Details on this topic will be made known later this year."
Speculation has suggested BMW will opt for either 'E'or 'EV' for the name of its sub-brand.
However, the 'Metro' name still belongs to BMW and has been closely guarded in recent years - it is believed BMW requested Audi drop the Metro name it used to launch its Audi A1 Metroproject concept car in 2007.
Full details are expected to be announced at this September's Frankfurt motor show.
In a separate statement BMW also announced an agreement with SB LiMotive, which is jointly owned by Samsung SDI and Bosch, for the supply of lithium-ion battery packs.
These will be used as part of BMW’s electric Megacity car project, which is also expected to fall under the new sub-brand.
BMW already has the electric Mini E under development as part of its portfolio.