Digger manufacturer JCB is to create 300 jobs over the next five years as part of a £41 million investment programme.
A new three-litre engine will start rolling off the production line after £31 million was spent developing the fuel-efficient model at the company's plant in Foston.
And a further £10 million is being ploughed into new machinery and processes as the company gears up for full production of the components which make up the engines, including cylinder heads, engine blocks and bedplates.
Fifty jobs have been created so far and a further 300 roles will up for grabs as production ramps up.
The JCB430 DieselMax engine is the fourth model launched by JCB since production first started in 2004 at the Power Systems factory. It joins the 4.4, 4.8 and 7.2 litre models, which provide power for more than 70% of JCB equipment sold around the world.
JCB chief executive Graeme Macdonald said: "It is hard to believe that, just over 12 years ago, JCB didn't make engines. Today JCB has produced 400,000 high-performance diesel engines, leading the way with a purpose-built range which saves fuel, is clean and highly efficient.
"The launch of the new three-litre JCB430 DieselMax engine will build on the success of the JCB Power Systems business and takes the productivity and environmental performance of our engines to a completely new level, particularly on fuel efficiency."
One of the impressive features of the new three litre engine is its fuel consumption – using up to 8% less fuel than the already fuel efficient 4.4 litre EcoMax engine.
The new engine is also 30% lighter than the 4.4 litre model and has been designed specifically for mid-range construction and industrial equipment operating cycles.
Launched initially with 55kW (74hp), the engine meets the relevant emissions legislation without any requirement for a costly Diesel Particulate Filter, Selective Catalytic Reduction or any form of exhaust additive or after treatment.
Among those who helped develop the new engine is advanced apprentice Sam Grief. The 19-year-old, from Willington, joined The JCB Academy at the age of 14 and began working at the Foston factory when he was 16, following his GCSEs.
Sam said: "When I first started here at 16, this new three-litre engine was what I began working on. I work in research and my job was engine testing. I've spent three years working on this and I think we've produced a fantastic engine."
Operations manager Robert Taylor, who lives in Chellaston, said it was great to see young people like Sam involved in the project.
He said: "I started here as an apprentice 12 years ago and worked my way up. Giving people the opportunity to progress here at Power Systems is something I want to continue."
CNC machining centres and associated automated processes have been installed as part of the £10 million investment in new machinery and processes, giving the company the capacity to produce 45,000 engine sets a year.
The investment will allow the company to produce cylinder heads, engine blocks and bedplates, the major engine components, in-house for the first time, boosting efficiency and ensuring that outstanding quality targets are met.
JCB group director for engines Alan Tolley said: "The multi-million pound investment in machining in-house gives us direct control over specification, quality and cost of the major components. This is a major step forward for JCB Power Systems and an important piece of the jigsaw that keeps us producing class-leading engines at competitive cost.
"Great progress has been made with our engine business in the last 10 years and there's more to come. We've continued to invest heavily in engine development and manufacturing to make sure our customers have the best engines available."