UK automotive manufacturers are aiming to break manufacturing records by the end of 2015.
Car production will be expanded, new models introduced and thousands of jobs created as a result of the investment unveiled in the last 18 months.
Figures released ahead of an international automotive summit today run by the Society of Motor Manufacturers and Traders (SMMT) showed the UK could surpass the 1972 record of 1.92 million cars produced, with more than two million units rolling off domestic manufacturing lines in 2015.
Achieving annual car manufacturing volumes in excess of two million units would mean an increase in manufacturing output of more than 50% over 2011's level of 1.3 million units.
Paul Everitt, SMMT's chief executive, said: "The UK automotive industry is leading economic recovery with increased manufacturing output, growing export volumes and new jobs being created on the back of major international investment in the sector. Our engineering expertise, workforce flexibility and renowned motoring heritage, combined with top level collaboration between industry and Government, makes the UK an important location for the global automotive industry.
"The UK has attracted unprecedented levels of new investment and has a tremendous opportunity to see vehicle manufacturing rise to record levels in the years ahead.
"To remain globally competitive it is essential that industry and Government continue to work in partnership and that key eurozone markets return to sustainable levels of economic growth."
The ongoing stability and success of the UK automotive industry was linked closely to demand from the continent, said the SMMT.
The SMMT said its summit in London today was the UK's most high-profile meeting of motor industry leaders, with 300 delegates and keynote speeches from company executives.
Meanwhile, Ian Robertson of the BMW’s Board of Management announced at the summit that a new generation of engines for the future BMW plug-in hybrid sports car would be built at a UK factory.
Robertson said the 3-cylinder petrol engines will be produced at the Hams Hall factory, near Birmingham, which last week produced its three millionth engine since it opened in 2001.
"The new 3-cylinder petrol engines will enable our future BMW i8 plug-in hybrid sports car to set new standards for dynamic performance in combination with industry-leading fuel-efficiency and low carbon emission levels," Robertson said.
Business Secretary Vince Cable said: "BMW's decision to produce engines for their i8 plug-in hybrid sports car at Hams Hall is more good news for the UK automotive sector and underlines its growing competitive strength."