BERLIN-- BMW AG, the German luxury car maker, is launching a car-sharing service in Seattle, Wash., and plans to roll it out eventually to other major U.S. cities, the company said on Friday.

The service, to be called ReachNow, illustrates how car companies are expanding their business from manufacturers of automobiles to providers of auto-related services.

ReachNow will launch in Seattle later this year, tapping the car-sharing trend in which a growing number of people choose to rent cars on demand rather than own them, especially in cities.

"This is why we are supplementing our classic business model with additional services that make life on the road easier for people in big cities," said Peter Schwarzenbauer, a member of BMW's board, in a statement.

ReachNow is modeled on BMW's European car-sharing service, which is called DriveNow. It will launch with 370 BMW and Mini vehicles in Seattle. Around 20% of the fleet will be made up of BMW's i3 battery-electric city cars.

Like the service's European cousin, ReachNow vehicles will be distributed throughout the city rather than at a central pickup point. BMW plans to offer the service in other U.S. cites at a later date.

Renting a ride will cost 49 cents a minute and customers will be required to register with ReachNow and pay a one-time registration fee of $29.

ReachNow will also offer a chauffeur service--ReachNow Black--that will launch at a later date. There will also be a delivery service, allowing users to order a ReachNow vehicle and have it delivered to them at an airport, at home, or another destination.

The service will be available via smartphones.

BMW's technology partner is the San Francisco-based startup RideCell.

Write to William Boston at william.boston@wsj.com