Ford To Return To India But Not For Car Manufacturing, US Automaker May Export Engines From Chennai Plant: Report

United States (US) automaker Ford has finalised plans to restart operations at its mothballed plant near Chennai, focusing on manufacturing and exporting engines and related components, sources familiar with the development told The Economic Times. 

An official announcement is expected in the second quarter of this year.

Ford, which ceased vehicle production in India in 2021 and exited the market the following year, has decided to repurpose its Maraimalai Nagar facility for engine exports rather than vehicle manufacturing.

“Ford is going to be making engines at the Chennai plant,” a source confirmed. “It (the facility) will be repurposed for export-focused production. This decision is part of Ford's broader global strategy,” he was quoted as saying by The Economic Times.

While discussions on reviving the plant have been ongoing, speculation arose that Ford might abandon its India plans due to the Trump administration’s push for local manufacturing and increased import tariffs. 

However, Indian government officials have confirmed that Ford’s plans are still on track, though they declined to disclose specifics about production details.

Ford’s senior executives recently held discussions with the Tamil Nadu government, reaffirming their commitment to India, according to sources. The plant, inactive since mid-2022, will now be repositioned to support Ford’s global supply chain for powertrains.

The company is already involved in exporting components from Sanand, where it sold most of its manufacturing operations to Tata Motors two years ago. 

The new engine production initiative in Chennai is reportedly in its final stages, with an official announcement anticipated soon.

Ford had previously explored re-entering the Indian market with electric vehicles (EVs), conducting feasibility studies for models like the Endeavour, Everest, and Mustang.