Ford to Manufacture Engines at Chennai Plant from 2029

Ford Motor Company has announced plans to restart manufacturing operations at its Chennai facility in Tamil Nadu. The company has signed a memorandum of understanding with the Tamil Nadu government to produce next-generation engines at the plant.

The announcement follows a letter of intent submitted by Ford in September 2024. The project will involve an investment of INR 3,250 crores. Production is expected to begin in 2029, with an planned capacity of 235,000 engines per year.

Also Read: Ford to Reassess India Plant Amid US Tariffs

There is no news yet though on which engines will be made in India and whether the company will use the Chennai plant as an export hub only. 

Ford ceased all vehicle manufacturing in India in 2021, marking the end of nearly 26 years of car production in the country. The company had accumulated losses of more than $2 billion over the previous decade. The company stopped vehicle exports from its Gujarat plant by the fourth quarter of 2021 and halted vehicle and engine manufacturing at its Chennai facility by the second quarter of 2022. Ford had previously produced vehicles including the EcoSport, Endeavour, Figo, Aspire, and Freestyle at these plants.

Since the 2021 exit, Ford has maintained its presence in India through customer support services. The company continues to provide service, spare parts, and warranty support for vehicles already in use in India. Ford currently employs approximately 12,000 people in its Global Business Operations in Tamil Nadu.

The new project at Chennai marks Ford's return to manufacturing operations in India, though with a different focus. The facility will produce next-generation engines with all-new technology for export to markets outside India. Specific details about the engine type and destination markets will be shared as production start date approaches.

The project is expected to generate more than 600 direct jobs at the facility, along with indirect employment opportunities in the supply chain. Jeff Marentic, president of International Markets Group at Ford, stated that the decision reflects the company's commitment to utilising India's manufacturing capabilities for its global operations.

Site preparation and investment in the project are scheduled to begin later this year. The Chennai plant will produce engines for Ford's global markets as part of the company's Ford+ growth strategy, which focuses on optimising manufacturing operations across different regions.