Jaguar Land Rover will close one of its plants in the West Midlands by the middle of the next decade.
The firm announced in its revised business plan that its Castle Bromwich plant in Birmingham or its Solihull plant would be shut, but it stated that there would be no net job losses due to an agreement between unions and parent company Tata.
Around 800 new jobs will be created next year at JLR's Halewood plant on Merseyside, when production of the new Range Rover LRX begins.
JLR currently employs around 5000 workers in Solihull, 2000 in Castle Bromwich and 1800 at Halewood. It will decide in the next 12 to 18 months which plant it will close. However a Land Rover spokeswoman told Autocar the existing plant would be expanded to accomodate the two workforces, and "definitely no jobs will go".
It said the plan was designed to increase the firm's competitiveness, drive growth and sustain profitability.
David Smith, JLR chief executive, said, “This is a plan that recognises the impact the economic collapse has had on our business, and at the same time the opportunities that lie ahead for these two great brands.”
Business Secretary Lord Mandelson said he welcomed "the commitment that Tata is showing in the highly skilled workforce employed by Jaguar Land Rover in the West Midlands and Merseyside, as well as the top-class models it produces".
However, Bert Hill, regional officer at the GMB union, voiced his concerns on the plans to the BBC and said the union would be opposing JLR's decision.
"We are now in a meeting with the company to hear details of their plans. The GMB will be opposing everything we have heard so far. We will fight the company on this - of that I have no doubt," he said.