Jaguar Land Rover says it's creating 1,700 new jobs and investing another £1.5bn into its factory at Solihull.
The firm will build a new plant on the site to make aluminium body panels and a final assembly line.
Jaguar Land Rover say the 1,700 jobs will create a further 24,000 jobs in the supply chain.
The company is building the new facility to make aluminium Jaguars.
Yesterday it said it's bringing out a mid-sized saloon car in 2015. It will be the first car which will be built on an aluminium platform which can be used to make several different models.
It's the first time the company will have a production line which can build several different models simultaneously, and allows it to go into high volume production.
Adrian Hallmark, Global Brand Director for Jaguar said:
'The potential of that one car is higher per year than the whole of Jaguar's last year's sales.'
The firm already makes an aluminium car - the new Range Rover - which has proved to be one of the companies most successful models - despite the £100,000 price tag.
In 2012 Jaguar Land Rover sold 357,773 cars. In the 12 months to March, this year, it had revenues of £15.8bn and profits of £1.675bn.
Since 2011 the company has created almost 11,000 new jobs.
Speaking about the announcement, Prime Minister David Cameron said: