German-based automaker Volkswagen AG has announced it will spend nearly $60 billion by 2016 to reduce carbon emissions from its vehicles and factories. The company will direct more than two thirds of its $82 billion investment program toward increasing vehicle fuel efficiency and “environmentally compatible” production.

The plan was unveiled during this week’s Geneva Motor Show, and “marks the start of a fundamental ecological restructuring,” said Martin Winterkorn, Chairman of the Volkswagen Group Board of Management. In addition to the overall investment program allocation, the company will direct an extra $18.4 billion just to the China market.

Volkswagen’s effort is expected to reduce CO2 emissions from its new vehicle fleet 30 percent by 2016 compared to 2006 numbers, and will target 10-15 percent greater efficient with each new model generation. Volkswagen already ranked fourth overall in the U.S. Environmental Protection Agency’s most recent fuel economy report with 24.6 miles-per-gallon (MPG) and was tied for fifth-lowest average CO2 emissions with 367 grams-per-mile (GPM).

Beyond just reducing tailpipe emissions, the company will also greatly reduce emissions from manufacturing. Volkswagen is targeting a 40 percent reduction in greenhouse gas emissions from the energy it uses to produce vehicles by 2020, mainly through $788 million in new renewable energy technologies.

The company’s “environmental compatibility of production” will also be improved 25 percent, meaning each vehicle will take 25 percent less energy and water to produce, and create 25 percent less waste and emissions.

While impressive, Volkswagen’s announcement is nothing new for the company. It has recently started sales of the Up! super-mini vehicle in Europe, has begun testing a battery-electric eGolf in the San Francisco area, and plans to sell a Golf plug-in hybrid starting in 2015.

In addition, Volkswagen’s Chattanooga, Tennessee plant also became the first vehicle manufacturing facility in the world to secure LEED Platinum certification last December. Design highlights include a 68 percent energy use reduction through LED exterior lighting, a 30 percent overall reduction in water usage, a roof rainwater collection system, and recycled glass floor tiles.