Toyota Motor Engineering and Manufacturing North America plans to expand its powertrain R&D operations in Ann Arbor with the addition of 45,000 sq ft of space.
The move, which forms part of a US$75.15m expansion plan, will add 85 jobs.
The Detroit News said the project, for which Ann Arbor Township will be providing a property tax abatement, is likely to secure more engineering and R&D work for Michigan.
The powertrain facilities are expected to open in late 2016 or early 2017.