In order to meet new manufacturing requirements, the implementation of smart materials in highly integrated mechatronic components, such as precision positioning systems in machine tools, is an alternative to bulky conventional electromechanical actuators. Magnetic shape memory alloy (MSM) actuators constitute an interesting alternative to both electromechanical and piezoelectric actuators. By harvesting the rotational energy of the tool body, it is possible to use MSM actuators together with permanent magnets to produce linear motions in the micrometer range. With the proposed approach, a higher level of integration is possible by eliminating the electronic control, thus reducing size and complexity of the system. This work presents a methodology for dimensioning MSM actuators excited by permanent magnets for producing linear motions in the micrometer range by exploiting the relative rotational motion of machine tool assemblies. The methodology consists in the simulation of the magnetic behavior of the actuator in order to predict the expected output stroke as a function of the magnet configuration. A novel concept for a fine boring tool with active cutting edge based on MSM actuation for finishing contoured cylinder bores in combustion engines illustrates the proposed methodology. Finally, a prototype was tested and the displacement at static and dynamic conditions in order to predict the corresponding contours at the cutting edge.