JCB is forging ahead with plans to produce diesel engines with the acquisition this month of a multi-million pound manufacturing plant.

JCB, which announced plans to build engines last August, has bought a 160,000 square-foot (14,865 square metre) facility at Dove Valley Park at Church Broughton, Derbyshire. A new company, JCB Power Systems Ltd, has been formed to manufacture engines at the new facility.

JCB chief executive John Patterson said the company would move into the plant immediately, and start low-volume production late this year.

"This facility is ideal in all respects for JCB's needs. It has excellent links with existing JCB factories in Rocester, Uttoxeter and Cheadle, which was one of the main reasons we chose this site," he said.

"While the factory is bigger than our initial production needs, it provides us with the capability to expand in the future as we manufacture more and more engines."

The site will employ more than 100 people. The existing engine design, development and purchasing teams would remain at JCB's world HQ in Rocester, the company said.