BMW X5

BMW has confirmed it is to expand its SUV range with a new premium flagship model called the X7, which will likely rival the Range Rover.

Due to go into production in 2016, the model will be the largest 4x4 ever produced by the German manufacturer. It will share the same platform as the current X5 and X6 models and will be built alongside them at the company's Spartanburg facility in North America.

The new model is BMW's riposte to increasingly large and luxurious SUVs from rival manufacturers. Mercedes-Benz has produced the seven-seat GL for a number of years, while Land Rover last year announced an exclusive long-wheelbase edition of its opulent Range Rover.

With a longer wheelbase and rear overhang compared to the current X5, the X7 will also be offered with a third row of full-size seats, capable of accommodating adults. BMW also offers the X5 as a seven-seat option, but their size means they are limited to use by children, or for shorter journeys.

Given its range-topping position, the X7 will not be available with the smaller four-cylinder engines and rear-wheel-drive configuration offered in cheaper versions of the X5, and will be offered solely in four-wheel-drive with a range of straight-six and V8 turbocharged powerplants.

The new model announcement comes as BMW celebrates 20 years of production at its Spartanburg plant, and coincides with the start of production of the new X4, which is the fourth SUV model from the brand, after the X3, X5 and X6.

To meet demand for new models, BMW is to invest a massive $1billion (£600million) in the Spartanburg plant between now and 2016, increasing manufacturing capacity from 300,000 units to 450,000 units annually.