BMW factories compete to build Megacity car
The car is an offshoot of the carmaker's Project i, which is tasked to develop new mobility concepts for urban areas with more than 10 million inhabitants.
Arnt said he had a "weakness for Germany" as a production location for the car but he is not ruling out neighboring countries.
Proximity to product development facilities would be "helpful" for the execution of the new vehicle concept, he said.
BMW is developing the car at its FIZ research and development center in Munich.
Arndt said a decision on the production site is due in the next few months.
The car is due to launch in the middle of the next decade.
Possible fourth brand
BMW CEO Norbert Reithofer announced in March 2008 that Project i had been set up to develop cars for big cities.
Reithofer said the project would present solutions to the challenge of tougher emissions requirements and restricted access to large cities.
The car could be sold as a fourth brand or sub-brand of BMW or Mini, Reithofer said at the time.
The car also will have an innovative lightweight design using carbon fiber.
Last week, BMW announced it has set up a joint venture with carbon-fiber specialist SGL Group to build lightweight components for the vehicle.
The new entity, 51 percent owned by SGL, will build two plants in North America and Germany to manufacture carbon-fiber automotive parts on a "large scale" for the first time, the companies said.
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