Ford's engine plant at Bridgend, South Wales, has emerged as the likely location for a pounds 250m investment that would double capacity and provide a huge jobs boost.
The company said it had not made a final decision, but sources say the promise of government aid has persuaded the US car giant to expand its UK facilities.
Ford has already put an extra pounds 200m into its Dagenham, Essex, plant and has announced that some Fiesta production is to be shifted from Valencia, Spain, to the site.
Now the company is close to announcing, possibly during next week's London Motor Show, whether to invest in new power train facilities at Bridgend to produce units for the new Fiesta going on sale next month.
Bridgend currently produces 550,000 16-valve engines a year, with about three-quarters of them going abroad. They include units for Mondeos. "We have a significant investment under review but no final decision has yet been made," said a Ford spokesman yesterday. "Bridgend is part of the equation and any announcement could well create many new jobs. We hope to make an official announcement soon."
One analyst said Ford may produce bigger and smaller versions of its new lightweight Zetec-ZE 16-valve 1.25 litre engine. Ford's factory in Cologne was another contender for the investment, though this is now thought unlikely.
Ford has already been promised an pounds 80m package of aid from the Government and agencies towards at pounds 400m investment by Jaguar in Birmingham. However, assistance towards the Bridgend investment would be substantially lower, probably in single figures.Reuse content