The announcement Wednesday by the chairman of Atlanta-based Carbon Motors Corp. drew cheers from the large crowd gathered inside the former Visteon plant in Connersville.
The company says it intends to invest $350 million in the plant and potentially hire 1,550 workers.
Carbon Motors' decision had been eagerly awaited among Connersville residents as the company considered sites in several states, including Georgia and South Carolina.
The Connersville area had a 15.9 percent unemployment rate in June. Michigan-based Visteon stopped production in 2007 at its factory, which once employed more than 3,000 people.
The company selected a site at a Graniteville industrial park in Aiken County as one of the finalists for the assembly plant. The plant was expected to hire as many as 1,500 people and indirectly bring about 10,000 jobs to the area.