Ford to develop Fiesta 1.6-liter engine in Brazil

Ford Motor Company will turn to Brazil to develop the 1.6-liter four cylinder engine that will power its much anticipated 2011 Ford Fiesta, the company said this week.

"This is an example of Ford's strategy to use the best of our global technologies and manufacturing capabilities to bring consumers the fuel economy they need," said Jim Farley, Ford's vice president in charge of marketing in Canada, Mexico and South America.

The engines will be built at Ford's Taubate, Sao Paulo, facility, located a few hours away from Sao Paulo city, the largest city in Latin America. The facility produces around 280,000 motors per year.

Brazil has become a go-to source of automotive innovation and technological know-how over the last decade. It's flex-fuel engine technology powers the majority of fuel economy cars in Brazil and has become an example of fuel efficiency.

Ford's Brazil operations reported a 22.7% growth in year-ending 2009 sales, much of it powered by its flex fuel sport utility, EcoSport. Ford is the fourth-largest car maker in Brazil and sold 235,063 vehicles last year.

In the U.S., the Ford Fiesta is scheduled to launch later this year with suggested retail price of $13,320 and estimated fuel economy of 40 miles per gallon on the highway, making it a direct competitor to the Toyota Yaris sub-compact, which averages around 36 miles per gallon on the highway.