The blaze at Coventry Castings, in Barlow Road, Potters Green, began at about 05:30 GMT.
About 30 firefighters tackled the flames while Barlow Road was closed in both directions at the junction with Dutton Road.
The fire was believed to have been started accidentally, by molten metal from a casting, said firefighters.
Updates on this story and more from Coventry
Crews said smoke was slow to clear because of a lack of wind.
Group commander Steve Harris told the BBC at the scene: "There was a fair bit of smoke; and obviously with the weather conditions at the moment, the smoke is not dispersing.
"So as a precaution, we are asking people to close their doors and windows while we try and deal with the incident."
The smoke warning to residents was lifted by 08:00.
A large fire broke out at a factory in Coventry, causing a road closure and smoke warning to nearby residents.