Former MG Rover workers will be recruited for new high-tech jobs as part of a £10 million project to transform part of Longbridge into a centre for making composite vehicle parts.
EPM Technology, the Midland company behind the scheme, said it would looking to bring manufacturing and sales and marketing specialists back to the site.
Between 450 and 600 people could ultimately be employed at the site, which has been unused and derelict for ten years.
Ultimately it could become a world leader in the manufacture of composite body parts, which car makers are looking to in order to reduce the weight of their vehicles, improve fuel technology and meet environmental targets.
The development is separate to Nanjing Automobile's plans to build MG sports cars elswhere at Longbridge and the two companies are understood not to have been in contact with one another.
But one car industry insider told The Birmingham Post that a link-up cannot be ruled out.
"If ultimately you have one company making sports cars and few hundred yards away from another that produces composite materials for sports cars then it would make sense for them to get together," he said.
EPM, a £4.5 million a year company that employs 130 people, yesterday signed a lease on 10,000 sq ft of the old North Works at Longbridge which it will convert into an advanced manufacturing and assembly centre.
The group is well known as a supplier of lightweight body parts for five Formula One teams, including the world champions, Renault.
It also counts sports car manufacturers TVR, Lotus and Marcos among its customers as well as luxury car marques Bentley, Aston Martin and Jaguar.
F1 car parts will continue to be produced at Draycott and the new Longbridge facility, which is expected to come on stream late next year, will produce larger body parts and chassis assemblies.
The new factory will see vehicle body systems start as raw materials and emerge as painted, fully bonded assemblies ready to be shipped to vehicle manufacturers.
A massive reclamation programme will have to be carried out by EPM in conjunction with the site owner, regional development agency Advantage West Midlands, including the stripping out of asbestos.
Ultimately it will see a decaying relic of the last century's car industry transformed into a clinically clean and efficient 21st century high tech manufacturing centre.
Company founder and managing director Graham Mulholland said: "This is one of the largest automotive composite projects ever to be undertaken by a private company.
"It will help hasten a new dawn for Longbridge, generating new business, deploying the very latest technology and creating new jobs for the area."
AWM chief executive John Edwards said: "This is absolutely fantastic news for the region as a whole.
"Companies such as EPM Technology are exactly the sort we want to attract to this part of the region and we are delighted to have been able to agree the deal on the North Works."
