Ford Plans $370 Million Investment In India Defying Trump Push

• Ford Motor Co. to invest Rs 32.5 billion ($370 million) in reopening its Tamil Nadu plant to produce high-end export-oriented engines with a capacity of over 200,000 units annually.
• The move marks Ford’s return to India after a four-year hiatus, reflecting renewed confidence under CEO Jim Farley in India as a key global manufacturing base.
• The investment comes amid U.S. India trade tensions and signals Ford’s strategic shift from EVs to strengthening engine production for global markets.

Ford Motor Co. is investing around 32.50 billion rupees ($370 million) in India to produce new engines, according to a person briefed on the matter, as it reopens a factory that the US carmaker shut down four years ago.

The Maraimalai Nagar manufacturing site in the southern Indian state of Tamil Nadu will be retooled to make high-end engines for export markets with an annual capacity of more than 200,000 units, said the person, who asked not to be named as the plans are private. The engines won’t be exported to the US, but it’s not clear which countries they will be shipped to, the person said, adding an announcement may come as early as this week.

In a deal that has been in the works for months, the US automaker, which first signaled its interest in resuming local production in India a year ago, is making the investment against a backdrop of heightened tensions between New Delhi and Washington. US President Donald Trump placed a 50 percent tariff on Indian imports earlier this year in a trade standoff, and has lashed out at the Asian country's purchase of Russian oil.

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.

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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've 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 the time it exited, Ford had accumulated losses of over $2 billion. It eventually sold the Sanand vehicle plant to Tata Motors, which now produces EVs there. In 2020, Ford's chief US rival, General Motors Co., also ended production in India, three years after it shifted to an export-only business model.

Other US companies have also been building up their manufacturing presence in the country, regardless of the political tension. Trump notably singled out Apple Inc. in May for its decision to manufacture in India, but the tech giant has since increased production of the iPhone 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.