Daimler AG is investing $1.3 billion to expand SUV production at its plant in Tuscaloosa, Ala., to expand production of future SUVs including hybrid models, the company announced.

The expansion will create 300 new jobs as the company adds a new body shop, major enhancements to the SUV Assembly Shop as well as upgraded logistics and IT systems.

"In the next years, we will invest $1.3 billion in the expansion of our SUV production and turn the Mercedes-Benz plant in Tuscaloosa into a high-tech location," said Markus Schäfer, a manufacturing and supply chain management executive. "In this way, we can produce the next SUV generations even more flexibly, efficiently and in proven top quality."

The new 1.3-million square foot body shop will use the latest lightweight technologies with innovative joining processes and employ a modular approach to manufacturing.

Mercedes-Benz U.S. International's current SUV Assembly Shop will be expanded by 139,930 square feet and receive a larger, more flexible "marriage" station, where the body is merged with the powertrain, allowing for production of a wider range of vehicles.

The plant was founded in 1995 and started production of the GLE (formerly M-Class) in 1997, which is now being built in the third generation. The plant added the GL in 2006 and the new C-Class sedan in 2014.

Mercedes-Benz is on track to build more than 300,000 vehicles in the U.S. this year.