The capital improvements are part of the company's plan to upgrade its facilities in the state, increase the number of employees involved in engineering and manufacturing and further improve vehicle fuel economy, Ford said in statement.
"Fuel economy and technology are consumers' biggest priorities -- and we have made them Ford's as well," said Mark Fields, Ford's president of the Americas.
Ford said the plan relies on a package of tax incentives that Michigan economic-development officials will consider this week. Once approved, the Dearborn, Mich.-based automaker expects to allocate its $850 million investment across several facilities, including its Van Dyke Transmission, Sterling Axle, Livonia Transmission and Dearborn Truck plants.
At Livonia and Van Dyke, for example, Ford plans to build new six-speed transmissions that will appear in all future Ford vehicles. The transmissions will play a key role in helping Ford to increase fuel efficiency across all its vehicle segments.
Ford previously said it plans to spend $950 million to revamp its Michigan Assembly plant to build a new version of the Focus compact car, due in dealer showrooms early next year. An electric-version of the Focus as well as next generation hybrid and plug-in hybrid vehicles are also all planned for production at the plant by 2012.
The plant, in the Detroit suburb of Wayne, once produced the large Lincoln Navigator and Ford Expedition SUVs.