BMW, the German premium carmaker, yesterday delivered record profits and sales for 2006 and forecast it would hit new highs this year for all three brands, including the Mini.

Shrugging off an EU plan to cap CO2 emissions from all new cars - fiercely resisted by German luxury manufacturers - the group posted a 25% jump in pre-tax profits to €4.12bn (£2.8bn) on sales up 5% to €48.9bn. BMW sold 1.37m cars in 2006, and is bringing forward its target of 1.8m by 2010, as it expects sales of Minis to jump this decade. With sales leaping in China, it will open a plant in India this month.

Norbert Reithofer, who replaced Helmut Panke last year as BMW's chief executive, said: "The past year has been the best financial year so far in the company's history." Mr Reithofer plans to expand Mini capacity at BMW's Oxford plant to 300,000 - on a par with Nissan's Sunderland factory; it is unable to meet demand, notably in the US, but has turned down suggestions it should build a second Mini plant outside the UK.

Sales of Minis fell 6% last year to 188,000 because of production restraints, but are expected to top 200,000 this year. Sales of the Rolls-Royce Phantom, built at Goodwood, rose last year from 796 to 805. Sales of the BMW brand rose 5.2% to 1.18m last year.

The group has pioneered use of hydrogen fuel-cells as an alternative to petrol or diesel, and is among those opposing European commission plans to impose a binding limit of 120g of CO2 emissions per km from 2012. European manufacturers agreed at the Geneva motor show this week to press EU governments for a looser target and timeframe.