Brent Snavely

Detroit Free Press

Ford said Tuesday it will invest $1.4 billion to overhaul its Livonia Transmission Plant so it can build an all-new transmission for its F-150 pickups and will also invest $200 million to add a production line at its Ohio Assembly Plant.

The $1.6-billion investments at the two plants are part of commitments the automaker made as part of its new four-year contract with UAW last fall to invest $9 billion and create or retain 8,500 hourly jobs in its U.S. facilities during the next four years.

It is the second time this month Ford has announced big investment plans for southeast Michigan. The automaker said earlier this month it was embarking on a 10-year plan to upgrade and consolidate dozens of research and engineering offices in Dearborn and to renovate its world headquarters building.

The investment plans also come as Ford has found itself under the microscope for a decision to invest $1.6 billion to build a new plant in Mexico to build small cars and create 2,800 jobs.

Joe Hinrichs, executive vice president and president of the Americas, said the timing of today's announcement is driven purely by the automaker's product cycle and is not a response to criticism from any politician.

"We are now up to $12 billion of investments over the last five years in the U.S.," Hinrichs told the Free Press. "We are proud of the fact that we make more vehicles in the U.S. than anybody else and we employ more UAW workers to do so than anybody else and we want to make sure that message is out there...We are a proud American company."

Ford has applied for a tax exemption from the State of Michigan estimated to be worth $27.3 million over 15 years. That request was on the agenda for the Michigan Strategic Fund's meeting Tuesday morning.

Ford proved its need for the tax exemption, according to a memo prepared for the Michigan Strategic Fund's board, and might have otherwise moved the same work to another state or to Mexico.

The investments create or retain a total of 650 jobs — an estimated 500 jobs at the Livonia plant and 150 at the Ohio plant. Hinrichs declined to break out how many new jobs will be created.

"Sometimes we are transferring people from different locations or moving people from one spot to another," Hinrichs said. "But the investment certainly creates those jobs. There will be some new hires ... but the majority of the people will be transferred in from other plants."

In Livonia, Ford is overhauling the plant so it can build a new 10-speed transmission for its popular F-150 pickups. The transmission, developed jointly by Ford and General Motors, will debut in the 2017 F-150 Raptor, which is expected to go on sale this fall.

The investment at Ohio Assembly Plant in Avon Lake will give Ford the ability to produce a chassis cab version of its Super Duty pickups.

Ford builds most of its F-250, F-350, F-450 and F-550 Super Duty pickups at a plant in Louisville, Ky., but needed additional capacity to meet growing demand.

Ford's investment in Ohio is in addition to a $168-million investment Ford announced last year to move production of its F-650 and F-750 trucks from Mexico to the Ohio plant. That move helped preserve 1,000 jobs.

“I am thrilled that through our collective bargaining with Ford we were able to secure a substantial investment for the communities of southeast Michigan and northeast Ohio,” UAW Vice President Jimmy Settles said in a news release.

Contact Brent Snavely: 313-222-6512 or bsnavely@freepress.com. Follow him on Twitter @BrentSnavely.