BMW is investing £250 million in its three Mini factories in the UK.
The money will be invested in manufacturing operations by the end of 2015 at the German car maker's plant in Oxford, steel body pressings operation at Swindon and engine plant at Hams Hall near Birmingham.
BMW also announced further volume growth with up to 10 different Mini models, with the potential for additional production capacity at Oxford.
Today's news comes on top of an announcement a year ago of £500 million investment and means additional job security for the 5,500 UK Mini workers, said BMW.
Harald Krueger, Member of the Board of Management at BMW Group, said: "A year ago we announced a further investment of £500 million in our UK production network by 2014 and today we are announcing an additional £250 million, taking us through to 2015. This brings the total to £1.75 billion since 2000.
"Over the last 11 years, Mini has been a unique global success and the BMW Group has even greater plans for the future development of the brand.
"Plant Oxford has played a major role in this with cars being exported to over 100 countries around the world. This additional investment is great news for all our employees in the UK and shows the BMW Group's commitment to Britain as a vital manufacturing base for us."
UK Business Secretary Vince Cable, who is visiting the Oxford factory today, said: "BMW's ambitious plans for Mini will ensure its UK sites at Oxford, Swindon and Hams Hall remain at the centre of Mini production worldwide. The investment of £250 million in addition to the £500 million last year demonstrates BMW's commitment to the UK and safeguards jobs for the future."
BMW said the extra volume for its growth plans for the Mini and the complexity of new models means that additional production beyond Oxford's maximum capacity was needed in the medium term and the company was now considering how to achieve this.
"Our preferred option is to establish a contract manufacturer as a satellite production as close to our UK operations as possible, at the Nedcar plant in The Netherlands, with whom BMW is in discussions," said Krueger.
"Oxford will provide special Mini production expertise for any new operation, particularly in the areas of dealing with the high complexity and customer individuality which Mini demands and in operating state-of-the-art, multi-model production lines. Just as Munich is the centre of the BMW world, Oxford is and will remain the home and the heart of Mini."
CBI head of enterprise and innovation policy Tim Bradshaw said: “BMW’s decision to invest in its UK plants re-affirms our position as one of Europe’s leading locations for car production, and will have benefits for the wider automotive supply chain.
“Coming hot on the heels of other recent announcements, this new investment shows the UK automotive sector is in good shape.”