Mercedes-Benz Spending $1 Billion to Build All-electric SUVs in, Where Else, Alabama

Timothy Cain
by Timothy Cain
mercedes benz spending 1 billion to build all electric suvs in where else alabama

Mercedes-Benz is investing $1 billion into its Tuscaloosa, Alabama, assembly operations in order to facilitate the production of its first EQ-branded SUVs in 2020. The investment, timed to roughly coincide with the beginning of Mercedes-Benz ML production in Alabama, is expected to result in the hiring of another 600 employees.

In the near term, Mercedes-Benz has been open with its doubts regarding the profitability of pure electric vehicles. Evidently, the long-term view is different. And it probably doesn’t hurt to pour more money into a U.S. operations hub that accounts for nearly half the vehicles sold by the automaker in America.

Alabamians already build the GLE-Class (formerly the M-Class), GLS-Class (formerly the GL-Class), and the U.S.-market C-Class sedan for Mercedes-Benz. Those three vehicle lines — four if you count the separate GLE-Class Coupe — accounted for 49 percent of Mercedes-Benz USA car/SUV sales in 2017’s first eight months.

Who’d have thunk, 22 years ago when Mercedes-Benz announced Alabama would be home to the automaker’s first major non-German plant, that we would reach a point where Americans would be responsible for assembling most of the Mercedes-Benzes Americans buy?

Through the first eight months of 2017, Automotive News reports that Mercedes-Benz has built 53,024 copies of the C-Class (down 16 percent, year-over-year) but 147,068 SUVs, an 11-percent increase.

Alabama is also home to production of the four American Honda products, production of which is down slightly to 239,534 units year-to-date, AN says. Alabama also hosts production of the Hyundai Elantra, Sonata, and the Santa Fe Sport. Hyundai’s total Alabama production is down 6 percent, all on the account of the brand’s decreasingly popular sedans.

Back at Mercedes-Benz, the German automaker will spend some of this new $1 billion investment on the company’s fifth battery plant and an after-sales-oriented logistics hub. Mercedes-Benz was already reinvesting in its Alabama operations in order to update the body shop and assembly line for current production. Naturally, the package used to entice further Mercedes-Benz investment in Alabama will include statutory incentives, performance-based incentives, tax abatements, and tax credits, according to Alabama Commerce Secretary Greg Canfield.

Mercedes-Benz first unveiled the EQ idea with the Generation EQ Concept at 2016’s Paris auto show. The production version is expected to offer around 300 miles of all-electric range.

[Images: Daimler AG]

Timothy Cain is a contributing analyst at The Truth About Cars and and the founder and former editor of Follow on Twitter @timcaincars and Instagram.

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  • I_like_stuff I_like_stuff on Sep 22, 2017

    I like my steak medium rare. I like my coffee black with no sugar. And I like my German cars made in Germany, damn it!

    • Sceptic Sceptic on Sep 23, 2017

      How do you feel about the Greater Reich assembled cars? Austrian and Hungarian built Mercedes have been outstanding in my experience.

  • Ash78 Ash78 on Sep 22, 2017

    As an Alabamian, there is an unspoken sense of pride that comes with with this, but after a few years it just faded into the background and became an entitlement. Because OF COURSE these cars are built here (and don't forget that Mercedes also exports a substantial minority of what they build here). These plants are mostly located in semi-rural areas outside of larger metro areas, so a lot of workers are predictably relatively uneducated, but very skilled (either in auto or in other trades, from machinists to poultry workers to textiles to cabinetry). The auto wages are a little better than other employers, but your average old-line union worker would balk at least until they saw how much house you could buy in Tuscaloosa county with $200k. And $500/year in property taxes. It's all relative. The attitude here is sort of the opposite of what I saw from my Midwestern friends who cheered on the worst 80s/90s products from GM and Ford simply because they're "local" or "UAW made." I wonder how we'd feel if our state produced crap, as well. Are we fairweather fans or die-hards? Actually, I'm not super proud of the Santa Fe. Just saying.

    • See 5 previous
    • Civicjohn Civicjohn on Sep 24, 2017

      @Whatnext Yes, the irony appears that you are no fan of the South and voted for Mrs. Clinton. Please bring along some facts and figures about the “crap wages and working conditions”.

  • Art Vandelay Dodge should bring this back. They could sell it as the classic classic classic model
  • Surferjoe Still have a 2013 RDX, naturally aspirated V6, just can't get behind a 4 banger turbo.Also gloriously absent, ESS, lane departure warnings, etc.
  • ToolGuy Is it a genuine Top Hand? Oh, I forgot, I don't care. 🙂
  • ToolGuy I did truck things with my truck this past week, twenty-odd miles from home (farther than usual). Recall that the interior bed space of my (modified) truck is 98" x 74". On the ride home yesterday the bed carried a 20 foot extension ladder (10 feet long, flagged 14 inches past the rear bumper), two other ladders, a smallish air compressor, a largish shop vac, three large bins, some materials, some scrap, and a slew of tool cases/bags. It was pretty full, is what I'm saying.The range of the Cybertruck would have been just fine. Nothing I carried had any substantial weight to it, in truck terms. The frunk would have been extremely useful (lock the tool cases there, out of the way of the Bed Stuff, away from prying eyes and grasping fingers -- you say I can charge my cordless tools there? bonus). Stainless steel plus no paint is a plus.Apparently the Cybertruck bed will be 78" long (but over 96" with the tailgate folded down) and 60-65" wide. And then Tesla promises "100 cubic feet of exterior, lockable storage — including the under-bed, frunk and sail pillars." Underbed storage requires the bed to be clear of other stuff, but bottom line everything would have fit, especially when we consider the second row of seats (tools and some materials out of the weather).Some days I was hauling mostly air on one leg of the trip. There were several store runs involved, some for 8-foot stock. One day I bummed a ride in a Roush Mustang. Three separate times other drivers tried to run into my truck (stainless steel panels, yes please). The fuel savings would be large enough for me to notice and to care.TL;DR: This truck would work for me, as a truck. Sample size = 1.
  • Ed That has to be a joke.