There is a factory in the city that makes parts for cars and buses.
sure,only one single word.
Well, I can't say that I can see one word that could be changed. I can understand how there could be some confusion with the sentence because, the way it's written it looks like the factory is "in the city that makes parts.....". Clearly, it's the factory that makes the parts, not the city, but I can't see a way of changing just one word in order to make that clear.
My only suggested versions would be:
There is a factory that makes parts for cars and buses, in the city.
There is a factory (in the city) that makes parts for cars and buses.