BMW has now produced two electric cars: the two-seat Mini E, of which 600 examples are on test in the U.S., Europe, and U.K., and the new ActiveE Concept unveiled at last month's Detroit Auto Show, which will be similarly tested starting next year.

But these are just preludes. The company will launch an all-electric vehicle sometime "during the first half of this decade," BMW said. That will be its first-ever full production vehicle to run solely on electricity stored in a battery.

2009 BMW Concept ActiveE

2009 BMW Concept ActiveE

2009 BMW Concept ActiveE

2009 BMW Concept ActiveE

MINI E

MINI E

Mini E electric vehicle - rear seat and load area mostly occupied by battery box

Mini E electric vehicle - rear seat and load area mostly occupied by battery box

Mini E electric vehicle - nope, no engine in there

Mini E electric vehicle - nope, no engine in there

In other words, not an engine in sight (though for markets outside the U.S., a small and ultra-efficient gasoline model will also be offered).

"Project i"

It's the result of research started by a carefully chosen team in March 2008 under the name of "Project i." The aim was to "move the organization one big step toward the future," said Ulrich Kranz, BMW's senior director of the initiative.

The group concluded it needed to create a new type of vehicle, far smaller and more energy-efficient, for use in the denser and more crowded megacities expected in the 21st century. It is being developed in parallel with the Mini E and ActiveE test programs.

The roundup

What do we know about BMW's Project MegaCity vehicle so far? From interviews in Detroit with Kranz, and also Peter Ratz, head of Project i development, here's our roundup of what you need to know:

WHAT: Small battery-electric vehicle from BMW, first of several body styles, all designed for for use in congested urban areas.

WHEN: Automotive trade journal Automotive News says production begins in mid-2013 for the 2014 model year.

WHERE: It will be manufactured in Leipzig, Germany, BMW said today.

BRAND: What's now called the "Megacity Vehicle" will become a "sub-brand" of BMW, the company says. Initial rumors said BMW  considered relaunching the historic Isetta name, under which it made three- and four-wheeled mini-cars under license in the 1950s.

SIZE: BMW clearly has a vehicle under development, but it is "still in development phase," said Ratz, so no dimensions are available. CEO Nobert Reithofer told Car and Driver the first model will be a four-seat, three-door hatchback, smaller than a 2010 Honda Fit.

BATTERY: Lithium-ion cells using a nickel-manganese-cobalt chemistry will be made by SB-Limotive, a joint venture of Korean conglomerate Samsung and German parts maker Bosch.

CAPACITY: The Megacity pack is likely to be 16 kilowatt-hours, half that of the ActiveE, according to Ratz. He noted a single row of 96 cells, in 48 floor-mounted modules, would keep the Megacity's center of gravity low to the ground.

MOTOR: The ActiveE uses a 125-kilowatt (170-horsepower) electric motor, driving the rear wheels. To carry the BMW brand and provide the performance buyers expect, the Megacity might have a motor with that power--or close to it, depending on how light it is.

MATERIALS: The Megacity will be made partly or full from carbon fiber, given BMW's recent joint venture with SGL Group, the only company in Europe to build carbon fiber. Designing a vehicle from scratch with such "lightweighting" can radically reduce energy use.

[BMW, Automotive News (subscription required), Car and Driver]