Set to tackle Daimler's Smart, the new "i-Setta" brand will try to mix urban hipness with eco-consciousness.

BMW has confirmed rumors that the company is creating a fourth brand.

In a statement released by BMW CEO Norbert Reithofer, he said that "The Board has now decided: This auto (Project i/ Megacity Vehicle) will be launched on the market as a sub-brand of BMW. As BMW is the innovation driver within the Group, the decision for a sub brand under BMW is the most logical step."

Set to tackle Daimler's Smart, the new "i-Setta" brand will try to mix urban hipness with eco-consciousness. According to a BMW Blog source, "i-Setta will be a reimagining of the original cult classic using today's and tomorrows technology to provide urban mobility and sustainability in a lovable modern design wholly inspired by the original."  While the original 1955 Isetta only had one door and a 13 hp (10 kW) engine, the new car will likely boast at least two doors and more powerful fuel efficient engines.

In perhaps the most telling move of all, BMW has released a new Isetta video campaign to promote their museum. In essence, they're reminding consumers about the Isetta before launching the new brand.

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BMW confirms 'i-Setta' as fourth BMW Group brand [Video]