Ford Adds Jobs to Boost U.S. Engine Output

02/21/2013| 02:06pm US/Eastern

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DETROIT--Ford Motor Co. (F) is expanding production of its two-liter, four-cylinder engines in the U.S. as smaller engines take the place of V6 motors in car and compact sport-utility vehicles.

The $200 million investment in a plant near Cleveland will add 450 more workers. For several years, Ford has been using smaller engines that use turbochargers and direct-fuel-injection parts to boost power and give drivers a similar experience to larger engines, but with better fuel economy.

"Clearly, our business is performing well and we need incremental two-liter capacity based on the demand," said Joseph Hinrichs, president of North and South America for Ford, in an interview.

The two-liter, four-cylinder engines, which Ford promotes under the name EcoBoost, are now the predominant choice in the Ford Escape and Edge sport utilities, as well as the Fusion sedan.

Ford has been shipping the engines to the U.S. from Valencia, Spain. The Spanish plant will continue making them for European models, but demand is high enough in the U.S. to justify the added investment here. In addition, moving production to the U.S. will lower Ford's exposure to fluctuations in the value of the euro.

The expansion at the Ohio engine plant is the latest sign of how Ford's recent run of strong profits in North America is translating to investments in upgrading and expanding manufacturing in the region. Ford has renovated and expanded several U.S. plants, and during the past year has added the capability to build an additional 400,000 vehicles annually.

Ford will continue to build a 1.6-liter, four-cylinder engine in Great Britain for shipment to the U.S. The engine plant in Ohio also makes a 3.5-liter V6 EcoBoost engine that is used mainly in the Ford F-150 pickup truck. As recently as 2009, Ford only sold the F-150 with a V8. Now, V6 engines make up more than 40% of sales of the truck.

Ford also is expanding production of a V10 gasoline engine at a plant in Windsor, Ontario. The 25% capacity expansion is designed to meet growing demand for recreational vehicles, particularly from Winnebago Industries Inc. (>> Winnebago Industries, Inc.). Ford is among the only suppliers of the engines and chassis for motor homes.

"There is strong demand for" recreational vehicles," Mr. Hinrichs said. "It's a good sign for economy."

Write to Mike Ramsey at mike.ramsey@wsj.com

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