In FSX, only the Extra300, FA-18 and P51 aircrafts are pre-installed with an exhaust smoke system which can be activated by pressing the “I” key on the keyboard.

To add the smoke effect to other aircrafts, insert the following lines at the end of the aircraft.cfg of your choice under SimObjects folder:

[SMOKESYSTEM]
smoke.0 = -10.0,  0.0, -1.0, fx_smoke_w

where

-10.0 = before or after the cockpit in feet
0 = left or right position from the center of the aircraft
-1.0 = above or below the midpoint of the aircraft

fx_smoke_w = white smoke
fx_smoke_r = red smoke

Followings are what I did to the Cessna 172 to create the mixing red-white effect in the picture.

[SMOKESYSTEM]
smoke.0 = -1.29,  23.77, -1.5, fx_smoke_w
smoke.1 = -1.66,  19.7,  -1.5, fx_smoke_w
smoke.2 = -1.79,  15.66, -1.5, fx_smoke_r
smoke.3 = -1.86,  11.49, -1.5, fx_smoke_w
smoke.4 = -2.37,  7.38,  -1.5, fx_smoke_w
smoke.5 = -2.56,  2.63,  -1.5, fx_smoke_r

smoke.6 = -2.63, -2.56,  -1.5, fx_smoke_r
smoke.7 = -2.43, -7.38,  -1.5, fx_smoke_w
smoke.8 = -1.92, -11.49, -1.5, fx_smoke_w
smoke.9 = -1.66, -15.59, -1.5, fx_smoke_r
smoke.10 = -1.6, -19.64, -1.5, fx_smoke_w
smoke.11 = -1.15,-23.75, -1.5, fx_smoke_w