Jaguar Land Rover needs a new engine plant to overcome a shortage of supplies from Ford – following an “amazing” success story which has transformed its sales.

Less than two years after JLR had to go cap in hand to the Government seeking cash as it battled to survive, the group is planning to develop its own engine facility as it racks up £1 billion in profits in just 12 months.

Reports this week revealed that JLR was considering potential sites in Wolverhampton, South Wales or India for the factory, which will create 1,000 jobs.

Unite national officer for automotive Roger Maddison revealed the rationale behind the JLR plan.

Mr Maddison, the leading union car industry official in the UK, said: “We are in constant touch with the company, we have heard the rumours, but they have not confirmed anything yet.

“If these rumours are true, then it is fantastic. If they are going to build the engine plant in the UK, it would be for the smaller engine market.

“It will be an addition to the ones they get from Ford and it means that Dagenham and Bridgend would continue to supply engines, and JLR will make the smaller engines themselves.

“Because Jaguar Land Rover have been selling so many cars, they have been going back to Ford saying ‘can we have another 5,000 engines, can we have another 10,000?

“Ford are working flat out at Dagenham and Bridgend. It is well known that Ford are struggling to keep up with engine supplies."

"Meanwhile, the success of Land Rover has been phenomenal and JLR have made themselves a billion pound profit – the success story at Solihull and Halewood is amazing.

"A couple of years ago, they had to go to the Government looking for cash because they were running short.