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(Bloomberg) -- BMW AG will add a low-slung electric sedan to its stalled “i” sub-brand, part of plans to accelerate the rollout of battery-powered cars to catch up with Tesla Inc.

The four-door model, kept under wraps as BMW showed journalists around its Munich design headquarters on Thursday, is set to go on sale by 2021 and will slot in between the squat i3 city car and the sleek i8 plug-in sports car. BMW declined to specify its name.

Overall, BMW plans to offer at least 12 fully electric vehicles by 2025, including battery-powered variants of mainstream models like the X3 SUV as well as the futuristic self-driving iNext. New technology is facilitating the revival of the “i” sub-brand, which hasn’t been assigned a new car since the i8 in 2014. BMW is predicting that next-generation batteries will allow driving ranges as far as 700 kilometers (435 miles). 

“We wanted to have a sufficient range that’s coming with the next technology jump,” Chief Executive Officer Harald Krueger said at the early showcase of the manufacturer’s plans for the Frankfurt motor show next week. For the green-car sub-brand, “there wasn’t a big gap. We planned it.”

‘More Tense’

BMW, which lost its luxury-car sales crown to Mercedes last year, is looking to claw back its leadership role in the segment. That includes being more aggressive with next-generation technology, especially electrics as European environmental rules tighten starting in 2020. BMW’s push is similar to Mercedes’s plans, which involves the EQ sub-brand.

Consumer demand for the i3, which was launched in 2013, has been sluggish due to concerns about its limited driving range and high price. But with the new regulations coming into force, automakers have little option but to make electric cars more appealing, especially as consumers shy away from diesel in the aftermath of Volkswagen AG’s cheating scandal.

“The environment is changing, it’s much more tense,” Klaus Froehlich, BMW’s development chief, said at the event. “Because of the actions of some, and I emphasize some, the credibility of our industry has been severely compromised.”

To contact the reporter on this story: Elisabeth Behrmann in Munich at ebehrmann1@bloomberg.net.

To contact the editors responsible for this story: Chris Reiter at creiter2@bloomberg.net, Tom Lavell

©2017 Bloomberg L.P.

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