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New Delhi: Ford Motor Company is making a comeback to manufacturing in India with a fresh investment plan. The American automaker will pump in Rs 3,250 crore into its Chennai facility to produce next-generation engines from 2029. This marks Ford’s first major manufacturing step in India since it stopped vehicle production in 2021.
The new project will reportedly generate over 600 direct jobs and several more across the supply chain. It also signals Ford’s intent to tap into India’s manufacturing ecosystem once again, though this time with a powertrain-focused approach instead of full-scale vehicle production.
Ford has signed a memorandum of understanding (MoU) with the Tamil Nadu government to restart its Chennai operations. The investment is part of Ford’s global Ford+ plan, which focuses on strengthening future powertrain programmes worldwide.
The Chennai plant will have a production capacity of 2.35 lakh engines per year, with operations expected to begin in 2029. Jeff Marentic, President of Ford’s International Markets Group, said the move confirms Chennai’s key role in the company’s global manufacturing network. He added that Ford appreciates the state government’s continued support and sees India as a vital manufacturing hub for future powertrain development.
Tamil Nadu Industries Minister Dr TRB Rajaa called the project a big boost for the state’s auto ecosystem. He said Ford’s return to Chennai reflects Tamil Nadu’s strong manufacturing base and the skill level of its workforce.
Ford has not revealed specific details about the engines that will roll out of the Chennai plant. What’s confirmed is that these will be next-generation powertrains featuring “all-new technology.” The engines are likely to be developed for both domestic and export markets, although the company hasn’t shared the target regions yet.
The automaker already operates engine manufacturing units in India that cater to global markets. This new investment will complement those facilities and expand Ford’s footprint in India’s auto components and export space.
This decision comes four years after Ford exited India’s passenger vehicle market. Back in September 2021, Ford halted local car production after accumulating operating losses of over USD 2 billion (about Rs 17,000 crore) over a decade. It also took a USD 0.8 billion (Rs 6,800 crore) asset write-down in 2019.
At its peak, Ford operated two manufacturing facilities, one in Chennai and another in Sanand, Gujarat. The Chennai plant could make 2 lakh vehicles annually, while Sanand had a capacity of 2.4 lakh vehicles and 2.7 lakh engines. Ford sold the Sanand vehicle manufacturing unit to Tata Motors in January 2023.
The new Chennai project, therefore, represents a careful re-entry for Ford, focused on engines rather than cars, and aligned with global supply needs rather than domestic retail demand.
Even after exiting vehicle production, Ford has maintained a strong presence in India through its Global Business Operations unit based in Tamil Nadu. The unit employs around 12,000 people and handles business, technology, and support services for the company’s international operations.
Ford continues to offer service, aftermarket parts, and warranty support for existing customers in India. The Chennai revival now gives it an opportunity to participate in India’s growing export-driven auto sector once again.
