Porsche has laid the foundation stone for the second extension of its Leipzig site.

"We are investing another EUR500m in the production facility to build the Cajun in Leipzig," said CEO Matthias Müller at a ceremony.

Over 1,000 new jobs and a new 17 hectare plant are being created to handle the production of the Cajun. The assembly plant is now to become a fully fledged factory with body assembly line and paint shop with production of the new SUV scheduled to start at the end of 2013.

In 10 years the plant has made over 420,000 Porsches using painted and trimmed Cayenne bodies from the VW Group Bratislava plant where the similar VW Touareg is made.

The site in Saxony has final assembled the Cayenne since it opened in 2002. After a first extension, the Panamera was added to the mixed-model assembly line.

Porsche has spent EUR280m at the Leipzig site so far.