Jaguar Land Rover (JLR) plans to create 1,700 jobs at its plant in Solihull as part of a £1.5bn investment in expanding its product range.
The money will be spent on designing systems to allow the chassis of future models to be made out of aluminium.
The first of these models will be a new mid-sized sports saloon car to be introduced in 2015.
The announcement was made at the Frankfurt Motor Show by JLR chief executive Ralf Speth.
"Today's announcement signals Jaguar Land Rover's ambitions to push the boundaries and redefine premium car ownership," he said.
"Jaguar Land Rover is a business driven by design, technology and innovation and this investment and level of job creation is yet further evidence of our commitment to advancing the capability of the UK automotive sector and its supply chain."
Smaller carThe design teams will be creating what they call an aluminium architecture, which is the part of the car on which the bodywork, seats and engine sit.
The idea is that it will be flexible enough to be the base for future model of either Jaguar or Land Rover cars.
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Carmakers are increasingly using aluminium in their vehicles because its light weight improves fuel efficiency.
The first car using the aluminium platform will be a smaller than other Jaguar models.
But in order to demonstrate the flexibility of the system, JLR has also unveiled a concept car called the C-X17, which is halfway between a sports car and an SUV, and could also be based on the new chassis.
JLR said that the jobs at the Solihull site would bring the total number of jobs it had created in the UK over the last three years to almost 11,000.
It also stressed that the investment would involve significant extra spending with its suppliers.
JLR has been owned by India's Tata Motors since 2008.
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