Ford's small cars will have a new 1.0-litre Ecoboost petrol engine from next year.
The three-cylinder unit is the smallest capacity engine Ford has ever made. It will have less than 120bhp, but should have the same performance as a four-cylinder engine with 'much higher fuel economy and lower emissions'.
The first car to feature the new engine will be the new B-Max, the replacement for the Ford Fusion which is due on sale next spring.
'No one has ever built a three-cylinder engine quite like this,' said Joe Bakaj, vice president of Global Powertrain Engineering at Ford.
'The new engine introduces many new technologies that could be part of the DNA of future Ford engines.'
Ford says it will reveal more details about the car at the Frankfurt motor show in September.