(Bloomberg) -- Bentley Motors Ltd. will build its first fully electric car in the U.K., part of a 2.5-billion pound ($3.4 billion) spending push to overhaul manufacturing and ditch its roaring 12-cylinder combustion engines.

The investment over the next decade will modernize Bentley’s factory in Crewe, England, the Volkswagen AG brand said Wednesday. The decision is a boon to the site’s 4,000 workers and the U.K. government, which has been trying to safeguard local manufacturing threatened by the country’s European Union exit and an accelerating electric shift.

“Our aim is to become the benchmark not just for luxury cars or sustainable credentials but the entire scope of our operations,” Bentley Chief Executive Officer Adrian Hallmark said in a statement.

Bentley plans to offer only plug-in hybrid and electric cars by 2026 and switch its entire lineup to fully battery-powered vehicles by the end of the decade. Luxury-car brands like Bentley, Ferrari NV and Aston Martin Lagonda Global Holdings Plc face a delicate task preserving brand identity in the costly shift to batteries. While also built around superior engine performance, Bentley’s push to electrify is getting help from Volkswagen’s vast technology investments, which seeks to challenge Tesla Inc. as the dominant EV maker.

READ MORE: Bentley to Retire Roaring 12-Cylinder Engines, Go Electric

Bentley said a more environmentally friendly Crewe plant will start producing the brand’s first EV in 2025. The company has already introduced plug-in hybrid variants of its Bentayga sport utility vehicle as well as the Flying Spur sedan.

Fellow Volkswagen brand Lamborghini has allocated 1.5 billion euros ($1.7 billion) for the shift to plug-in hybrids, and plans to offer a purely battery-powered model during the second half of the decade.

©2022 Bloomberg L.P.