The Detroit automaker already makes the Focus, Fiesta and other sedan models in China in a tie-up with Chongqing Changan Automobile Co <000625.SZ> and Japan's Mazda Motor <7261.T>.
The new plant, to be based in the southwestern Chinese city of Chongqing, will have annual production capacity of at least 150,000 units per year, the source told Reuters, adding to Ford's current car manufacturing capacity in China of 447,000 units.
The source did not give financial details or further information regarding the new plant.
Representatives at Ford Motor in China and the company's joint venture declined to comment.
(Reporting by Fang Yan and Edmund Klamann)