Ferrari will ramp up investment in new technology by half to €2bn through 2017 as the Italian marque seeks to build the world's most fuel-efficient high-performance engines.
"Ferrari will build the world's highest-performance and most efficient engines in the world," chairman Luca di Montezemolo said. "The secret is innovation, innovation, innovation."
"We want to build cars that have fantastic performance that stay inside the [emission] rules," Mr Montezemolo told the Financial Times in an interview at the Frankfurt motor show.
The fact that Ferrari, famed for its prancing horse logo, roaring engines and unadulterated performance, is working to curb its emissions underlines the pressure being put on the entire car industry to reduce its carbon footprint.
Ferrari spent €1.4bn on product investment in the five years to end-2012, including the development of its first hybrid car, the LaFerrari.
The investment figures do not include the brand's investment in the Ferrari Formula One team.
"This is about - without using electric engines and hybrid all the time - being innovative and reducing fuel consumption and emissions, while keeping the emotional pleasure of driving," said Mr Montezemolo.
The carmaker, owned by Fiat, says the investment will be funded internally. Ferrari has cash reserves of over €1.2bn and had a positive cash flow of almost €200m in the first half of the year.
Fuel consumption in new Ferrari models has been reduced by 35 per cent in the past four years, and carbon dioxide emissions have been reduced by about a quarter, even as the company increases the power of its engines.
Alongside the engine development, the extra spending will enable Ferrari to bring out at least one new model every year, plus special edition cars.
Ferrari, which has 700 buyers lined up for the 499 models of its $1.4m LaFerrari model, sold 7,300 cars in 2012 but has announced that it will reduce production by around 400 this year to maintain the exclusivity of the brand.
Despite that pledge, the carmaker will increase its global footprint this year, entering the Moroccan market next month and starting sales in Azerbaijan by the end of the year, Mr Montezemolo said.
Profit growth will be driven by an expansion of its merchandising and add-ons such as its car tailoring service, he added.
Ferrari clients pay at least €50,000 to have their choice of interior material and colours.
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