Ford Motor Co. plans to invest about 32.5 billion rupees ($366 million) in India to make new engines, the Detroit-based automaker said Friday, signaling renewed confidence in the country and defying Donald Trump’s promotion of American manufacturing as it reopens a factory closed four years ago.
The Maraimalai Nagar manufacturing site in the southern Indian state of Tamil Nadu will be retooled to make high-tech engines for export markets with an annual capacity of 235,000 units, the statement said. Details on the engine type and where they’ll be exported to will be annnounced closer to the start of production, it added.
Bloomberg News first reported the plans on Thursday.
The US automaker, which signaled its interest in resuming local production in India a year ago, has been preparing the investment for months against a backdrop of heightened tensions between New Delhi and Washington. Trump placed a 50% tariff on Indian imports earlier this year in a trade standoff, and has lashed out at the Asian country’s purchase of Russian oil.
Ford said it will start work on the site this year, with production slated to begin in 2029.
The move comes even as Trump made boosting manufacturing in the US — especially where the automotive industry is concerned — a signature policy goal. Ford caught flack from the president during his first term for a plan to increase output outside the US, but more recently won praise from him after announcing major investments at its domestic plants.
Ford’s decision reflects renewed confidence in India as a manufacturing base from Chief Executive Officer Jim Farley and comes as it pivots from a previous focus on electric vehicles. The Dearborn, Michigan-based company first set up manufacturing near Chennai in 1995 and added a second plant in Sanand, Gujarat, in 2015.
Shortly after becoming CEO in 2020, Farley pulled the plug on a deal with Mahindra & Mahindra Ltd. that would have kept Ford vehicles on Indian roads. He abandoned the market altogether less than a year later, saying it could no longer pour capital into marginal markets like India and Brazil that provided little or no return.
By by the time it exited, Ford racked up losses totaling over $2 billion. It ultimately sold off the Sanand vehicle plant to Tata Motors, which now builds EVs there. In 2020, Ford’s chief US rival, General Motors Co., also ceased production in India, three years after shifting to an export-only business model.
More recently, other US companies have been building up their manufacturing presence in India, despite the political tension. Trump singled out Apple Inc. in May for its decision to manufacture in India, but the tech giant has since ramped up iPhone production across five Indian factories.
Tamil Nadu, where Ford plans to restart its old facility, is one of India’s largest industrialized states and a longtime automaking hub. It’s home to manufacturing facilities operated by Hyundai Motor Co., Renault SA, and BMW AG.
(Reportig by Alisha Sachdev with assistance from Keith Naughton)
Disclaimer: This report is auto generated from the Bloomberg news service. ThePrint holds no responsibility for its content.