Germany's BMW Group plans to buy the car-leasing unit of Dutch banking group ING for around $1 billion to expand its own fleet division and to support its budding electric car business.

The acquisition of ING Car Lease for 637 million euros will increase the number of car contracts under management by BMW's Alphabet Fleet Management from 300,000, serving more than 12,000 customers, to around 540,000, BMW said Friday.

"Fleet management will also support the introduction of electric vehicles," said Norbert van den Eijnden, chief of Alphabet.

Analysts say automakers rolling out all-electric and other high-tech cars will rely increasingly on their leasing operations, reported The Detroit News.

Most people will be reluctant to buy the early electric cars because of concerns about their residual values. "Why buy a first-generation electric car when you know the technology is likely to be obsolete in three-four years?" said auto consultant Maryann Keller of Maryann Keller & Associates in Stamford, Conn. "It's easier to get people to make a monthly payment."

It's also easier for automakers with their own leasing operations to subsidize the cost of battery-powered electric vehicles. That way, they can put as many customers as they want behind the wheel and see how the cars perform, Keller said.

BMW has leased electric Mini cars and has developed a BMW-badged ActiveE electric car.

At the same time, European companies with vehicle fleets also are under pressure to curb carbon dioxide emissions.

"We currently see many automakers putting more focus on fleet management," Deutsche Bank analyst Tim Rokossa said in a research note today.

The commercial fleet business is important in Europe, where company cars are often part of executive compensation.

"The strengthening of the fleet management business is in line with the BMW Group strategy to be the leading provider of premium products and premium services," BMW said.

It said the deal with ING was expected to close in the fourth quarter of 2011.

Deutsche Bank noted that BMW, based in Munich, had 12.5 billion euros, or $17.5 billion, in cash from industrial operations, at the end of the first quarter. "As such BMW has in our view enough cash to easily digest this acquisition," Rokossa said.