BMW is considering opening a factory in Russia as the country's new-car sales recover after years of decline.
BMW is evaluating future possibilities in Russian production, a spokesman told Automotive News Europe by email.
The automaker said it sees "Russia over the long term as a growing market for the BMW Group," the automaker said.
BMW's local partner Avtotor currently builds the brand's sedans and SUVs from kits in in Kaliningrad, according to Automotive News Europe's European car assembly plant map. Kaliningrad is a potential location for the new plant.
BMW said it had made progress "in elements of an agreement for future cooperation with our longstanding partner Avtotor," adding that it considered Kaliningrad as a "feasible location" for a new plant.
BMW did not say what models it could build at the new plant.
Russian new-car sales are bouncing back after a four-year slump caused by falling oil prices and Western sanctions against Russia's involvement in Ukraine.
Through September, industrywide sales grew by 11 percent, according to data from the Association of European Businesses. BMW's brand sales rose 6 percent in the same period.
The group now expects market growth to reach 11 percent this year, up from an earlier prediction of 4 percent.
Daimler will start building Mercedes-Benz sedans and SUVs at a new factory near Moscow in 2019.