The new vehicles are being developed with Brilliance, BMW's joint venture partner in China, and will feature a ‘new energy powertrain’, added Mr Robertson.

‘The new brand is part of our commitment to the market in China and we are working closely with Brilliance.’

It is understood that there are no plans in the short-term to export as the sub-brand will concentrate on the domestic market.

Western car companies have had to form ventures with local partners to establish manufacturing in China but now the Government is pushing for domestic sub-brands to be created within these ventures.  

Sources in China have suggested the name of the BMW-Brilliance brand will be Zhi Nuo, which means “Promise” in English. To avoid sharing its latest technologies the cars will reportedly be based on older-generation models like the previous 3 Series, however BMW has not confirmed these reports.

China and other emerging markets are increasingly important for BMW as Europe continues to struggle. Mr Robertson said: ‘The south of Europe is not good. Total market sales are down by one million a year in both Spain and Italy.

‘As well as China, we made a decision five years ago to concentrate on five key growth markets, Brazil, Russia, India, Turkey and South Korea. All these market have performed very well for us. For example, in that time frame our sales in Korea have grown from 7,000 to 25,000 a year.’