Porsche will have completed the structural work and erection of steel girders for the new engine plant at its Zuffenhausen site by the end of the year.

By the beginning of 2016, the new 10,000sq m development in the northern part of Stuttgart will include an assembly line with logistics areas and engine testing equipment plus offices and staff recreation rooms.

The two-storey plant will accommodate a total workforce of around 400 people.

Oliver Blume, production and logistics chief at Porsche, said the construction of a new engine plant at a cost of around EUR80m (US$99.64m) is a clear indication of Porsche's commitment to production at the Zuffenhausen site. Blume also added that the expansion of engine manufacturing capacity could lead to improved use of synergies within the Volkswagen Group.

"The basic principle underlying this investment in jobs for the future is sustainability. It's excellent news for our workforce and it reinforces the position of Porsche as a good employer," said HR chief Thomas Edig.

Porsche will be spending over EUR300m at its headquarters in Stuttgart-Zuffenhausen, through to 2016.

Along with the new engine plant on the site of a former cable factory, the company is converting existing buildings previously used for gearbox manufacture into central vehicle workshops. A training centre for the youngest Porsche employees is also being built on land where a tram depot once stood. For these projects and to develop the inner urban factory spaces, the automaker made a number of acquisitions, increasing the extent of its property in Stuttgart to over 600,000 sq m, double the previous size.

Over the next few years the company will be spending well over EUR1bn on construction projects in Germany with the aim of ensuring further growth.

Plans include EUR95m for a new test centre for drive systems at the Weissach site and a spend of around EUR500m in further expansion of the plant in Leipzig for switching to full production of the Panamera there.

A further EUR25m will be invested for the future assembly of components for the Porsche Cayenne at the multi-brand site in Osnabrück.