The popularity of the new Mini is driving growth at its German maker, BMW.

BMW has pledged to increase its yearly Mini output by 15-20% in order to cater for the unexpected demand in the US.

While sales of the original Mini were somewhat of a flop in the US, the chunkier new version is proving to be much more popular.

The company's outgoing chief executive, Joachim Milberg, made the announcement at the firm's annual general meeting.

He now hands over the reins of the company to Helmut Panke, the firm's 55-year-old chief financial officer.

Mr Milberg also reiterated that BMW's overall sales and profits were on course to grow in 2002, as long as economic conditions would not deteriorate unexpectedly.

BMW has sold a total of 38,967 new Minis in the first four months of the year, and expects to sell more than 100,000 in the year as a whole.