While BMW is preparing to unveil the new M3 and M4 this month, the development of the next-generation 7 Series is already underway to rival the new 2021 Mercedes S-Class. The new 7 Series will also spawn an all-electric variant reportedly called the BMW i7.

This will essentially be BMW's answer to the Mercedes EQS. Our spies have caught BMW testing a new camouflaged prototype of the i7, which was joined by a plug-in hybrid prototype. Visually, both models appear to look nearly identical, while the "electric test vehicle" and "hybrid test vehicle" stickers applied to the front driver and passenger doors and rear bumpers helpfully set them apart.

Naturally, the new 7 Series PHEV also has a quad exhaust system integrated in the rear bumper, which isn't required on the fully-electric i7, along with an additional fuel cap for the combustion engine. The i7 will also have a closed-off grille.

While these are still early prototypes, both models appear to be wearing production bodies, but plastic cladding hidden beneath the camouflage alters the shape of the front and rear. The headlights and taillights are also fitted with provisional headlights and taillights. Compared to the current 7 Series, the front headlights are positioned lower, but that could be the camouflage deceiving us. Despite the camoflague, it's clear the new 7 Series will have a radically different face as the prototype's front end has a "shark-nose" look reminiscent of the first-generation 6 Series.

The kidney grille looks larger than the current model's, but still smaller than the new 4 Series' gigantic grille. We don't have any photos of the interior yet, but the cabin will need to have a major overhaul to help the new 7 Series compete with the S-Class.

BMW has already confirmed the electric 7 Series will be the most powerful version of the new luxury sedan, with reports caliming the range-topping version will produce over 650 horsepower and provide 435 miles of electric range. Stricter emissions regulations also mean the new 7 Series will no longer be offered with a V12 engine.

The next-generation BMW 7 Series is expected to debut in late 2022 or early 2023.