Ford to sign MoU with Tamil Nadu government to re-open engine plant in Chennai, create over 600 jobs

The new Chennai engine plant will form part of Ford’s global powertrain network. (Courtesy: Reuters photo)

American auto giant Ford Ford is set to sign a Memorandum of Understanding (MoU) with the government of Tamil Nadu today to establish a new engine manufacturing line at its Chennai plant, sources close to the development told Moneycontrol. Itis expected to create more than 600 jobs.

The MoU will be signed in the presence of Minister for Industries TRB Rajaa, following a meeting between Ford executives and Chief Minister MK Stalin scheduled for 11 am.

As part of the agreement, Ford has confirmed plans to manufacture new powertrain engines with advanced technology. The company will invest Rs 3,250 crore in the project, aimed at boosting industrial growth and employment in the state.

The proposed facility will have a planned capacity of 2,35,000 engines per year, with production slated to begin in 2029. Site preparation for the project is expected to start later this year.

This development follows a letter of intent signed in September 2024, during CM Stalin’s visit to the United States. The move marks Ford's renewed engagement with Tamil Nadu after ceasing vehicle manufacturing operations in India in 2022.

The new Chennai engine plant will form part of Ford's global powertrain network, supporting its advanced manufacturing and export plans.

The plant, located in Maraimalai Nagar on the outskirts of Tamil Nadu capital, has remained non-operational since 2022.

While there was some buzz around resuming work at the plant, many felt that the new tariff policy announced by US President Donald Trump may change the game.

The move comes as Trump continues to push his 'Made in America' manufacturing agenda, with a focus on the auto sector. Ford, once criticised by him for expanding overseas, later earned his praise after committing major investments to its US plants.