BMW has been awarded a licence to launch a ride-hailing firm in China in December, making it the first global car manufacturer to enter the competitive market.
Operating under the name BMW Mobility Service, BMW said its licence has been granted for initial operations in Chengdu, the capital of Sichuan province.
The Chinese market is a hot bed of rivalry, currently dominated by Didi Chuxing with more than 217m users and a 90 per cent market share after merging with Uber China in 2016. The sector is currently worth $30bn (£23.4bn) and will grow to $72bn over the next two years, which is more than all other geographical ride-hailing markets combined according to Bain & Co.
BMW said in October that it would pay €3.6bn (£3.2bn) to increase its stake in a joint venture with Chinese partner Brilliance China Automotive Holdings from 25 per cent to 75 per cent.
Today's move follows a deal signed by Chinese car manufacturing group Geely with rival German firm Daimler last month to form a joint venture in the region for a luxury ride-hailing service.
Headquartered in Hangzhou, China, the 50:50 partnership will utilise Mercedes Benz S-Class, E-Class and V-Class vehicles among others in an attempt to differentiate itself as a luxury offering compared to Didi.
Didi itself has been in hot water in China, after a passenger was raped and killed by her driver in August. Didi said it would plug 140m yuan (£16m) into improving its customer service as a result, and had suspended its carpooling service Hitch in the wake of the incident.