Bill Pierre Ford

Ford Motor Company says it plans to invest US$500 million to double its production in India.

It will also start making a low-cost small car intended to help the U.S. automaker boost its market share there.

The company says a significant part of the investment will go into developing new products, including the new small car within two years and an engine manufacturing facility by 2010.

Ford says it plans to double capacity at its existing plant near the southern Indian city of Chennai to 200-thousand cars over the next three years to accommodate production of the small car.

Today’s announcement comes on the eve of an auto show in New Delhi, where automobile manufacturers from around the world will showcase their products and explore strategies to expand in India.

As rising middle class incomes drive demand for cars in India, automakers are rushing with plans to make inexpensive compact hatchbacks that dominate the Indian roads.

The Indian market is dominated by Japan’s Suzuki, South Korea’s Hyundai and homegrown Tata Motors, all of which have strong offerings in the small car segment.

Companies like Ford have not had much success because they mostly tried to sell sedans.

Two General Motors cars, Ford’s sales leader and a high-powered diesel concept from Audi were the winners of the 2008 AutoWeek Editors’ Choice awards at the North American International Auto Show.

The selections were made after vigorous debate among AutoWeek’s editors following the press preview days for the Detroit auto show.

“Sometimes the discussion lasted only a few minutes, and then there were times when we went back and forth and had appeals,” said Dutch Mandel, AutoWeek editor and associate publisher. “But these vehicles are the best from this show.”

The four honored vehicles are:

–Most Fun: Audi R8 V12 TDI concept. “The R8 is already one of the sexiest supercars on the road,” said Mandel. “But Audi upped the game considerably with a turbocharged V12 diesel.”

–Best Concept: Cadillac CTS Coupe. “We can’t wait to see this on the road,” said Mandel. “You can even see fins in the taillights.”

–Most Significant: 2009 Ford F-150. “This is the bread-and-butter vehicle for Ford. If Ford is going to bounce back, it will do so on the back of this new F-150.”

–Best of Show: 2009 Chevrolet Corvette ZR1. “This is an iconic car and an iconic Corvette. A carbon-fiber body and 620 hp under the hood–we love it.”

The awards were handed out on Wednesday during the AutoWeek Design Forum in Detroit.