Ford will boost Britain’s automative industry by making electric car components at its factory in Halewood.
The car company selected the Merseyside site over one of its plants in Germany for a £200m investment into its e-Drive transmission systems.
The systems control power from batteries used to run a vehicle’s wheels.
The deal secures the future of the 500 staff members working at the site.
They currently make transmissions for petrol Ford vehicles including the Fiesta and Focus, which are then exported to manufacturing plants in Europe.
Britain is banning the sale of new cars powered exclusively by internal combustion engines from 2030.
The EU is planning a similar move from 2035.
This had raised questions about Halewood’s future.
Ford is being supported with taxpayer money from the Government’s £500m Automotive Transmission Fund.
The strategy was announced last year as part of Prime Minister Boris Johnson’s 10-point plan for a green industrial revolution.
The government wants develop and mass-scale production of electric vehicle batteries.
Ford is understood to be getting about £25m from the fund.
Other international car companies that have used the fund include Nissan.
The car manufacturer reportedly received £100m to bring a battery gigafactory to its Sunderland facility as part of a £1bn investment.