Toyota is to invest £240 million in its plant in Derbyshire, but the car giant's boss has called for continued tariff- and barrier-free access between the UK and Europe.
The Japanese firm said the investment into its plant in Burnaston will see the centre upgraded with new equipment, technologies and systems.
Dr Johan van Zyl, president and chief executive of Toyota Motor Europe, said the cash injection was a sign of confidence in employees and suppliers.
But he warned: "Continued tariff- and barrier-free market access between the UK and Europe that is predictable and uncomplicated will be vital for future success."
His comments come as the Government faces intense pressure to secure tariff-free access to the EU's single market for car manufacturers following Brexit.
The money will improve competitiveness and enhance the car marker's "supply chain efficiencies", as well as enable the production of vehicles on the Toyota New Global Architecture (TNGA) platform, the group said.
Dr van Zyl added: "We are very focused on securing the global competitiveness of our European plants. The roll-out of TNGA manufacturing capability is part of this plan.
"This upgrade of Toyota Motor UK is a sign of confidence in our employees and suppliers and their focus on superior quality and greater efficiency. We welcome the UK Government funding contribution for this activity."
"Our investment demonstrates that, as a company, we are doing all we can to raise the competitiveness of our Burnaston plant in Derbyshire."
The money will be backed by up to £21.3 million of Government investment, subject to independent assessment, to support skills and training, research and development and innovation.
Business and Energy Secretary Greg Clark said: "Our automotive sector is one of the most productive in the world and Toyota's decision to invest £240 million upgrading its Burnaston plant is a further boost to the UK auto sector.
"I also welcome the prospect of investment to take Toyota New Global Architecture into the supply chain.
"Toyota is one of the world's largest car producers and this inward investment underlines the company's faith in its employees and will help ensure the plant is well positioned for future Toyota models to be made in the UK."
Theresa May has given special Brexit assurances to rival Japanese carmaker Nissan as thousands of jobs in the sector hang in the balance after the Prime Minister confirmed that she will extricate Britain from the free trade area.