The outstanding quality of its British workforce was a major factor in BMW's decision to invest a further £500 million ($990 million) in its Mini assembly plant in Oxford and other operations, the group's chairman Norbert Reithofer said yesterday.
Product quality and productivity at its UK operations was "absolutely at the same level" as its other European and US plants, he said.
The next generation of the Mini would be built at Oxford and could develop into a "brand family" with up to 10 varieties.
The company also reaffirmed its commitment to its other UK operations - the engine plant at Hams Hall, Birmingham, a pressings division at Swindon and the Rolls-Royce factory at Goodwood, West Sussex.
Reithofer hinted that the new generation of small BMW-badged cars could also be built at Oxford.
Last year 216,000 Minis were made in Oxford - 80 per cent of them for export to 90 countries.
In all, BMW exported £2.4 billion of cars and engines from Britain last year.
The latest move takes the company's investment in the UK to more than £1.5 billion since 2000, when it abandoned its Rover business at Longbridge, Birmingham.
The BMW announcement, which will help safeguard 5000 jobs at Oxford, follows news from Nissan that it will spend £192 million developing and producing the next generation of its successful Qashqai at its Sunderland plant.
But senior figures at BMW warned that the UK component industry was still not strong enough to be able to take full advantage of the expansion that they plan.
Ian Robertson, head of sales and marketing and a BMW board member, said: "There are some exceptionally good companies, but there are not enough of them.
"The supply industry in the UK has reduced in significance in the past few decades. The Germans make a lot of stuff."
Reithofer met Prime Minister David Cameron and Business Secretary Vince Cable at a gathering of leaders of the European car industry in London.
Dieter Zetsche, head of the European Automobile Manufacturers Association and also chairman of Daimler - makers of Mercedes-Benz vehicles - called for the EU to ensure a "level playing field" and for the abolition of barriers to trade with emerging producers such as India.
He urged European governments to invest in green technology and to standardise some elements of electric cars, such as plugs and sockets.