The new Ford Figo is to be manufactured in India in a bid to boost sales in the fast-growing Asian market.
Company executives revealed the car will initially be sold in India, but there are plans to export the car to other Asian countries.
Production for the Figo, which is Italian slang for "cool", is set to start in the first three months of 2010.
Michael Boneham, president of Ford India, said production of the Figo will be a "game changer" and added it will "give us muscle in the heart of the Indian market".
As part of a $500 million (£306.8 million) India investment plan, Ford wants to double production at the Chennai plant to 200,000 vehicles per year.
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