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Alabama’s auto industry prepares for electrifying next chapter

It’s clear the global auto industry views electric vehicles as the future, prompting automakers to craft strategic plans — powered by massive investments — to position themselves for a revolutionary shift that’s approaching at top speed.

In Alabama, which has become a top auto-producing state over the past 25 years, the industry is making major moves to capitalize on the EV revolution.

It’s starting with Mercedes-Benz, which launched Alabama’s auto industry in 1997 when the first M-Class rolled down the sparkling new assembly line at the automaker’s Tuscaloosa County factory.

Today, Mercedes is steering Alabama into the future once again as a $1 billion investment to prepare for EV production is coming to fruition.

In August 2022, just months after opening a sprawling battery assembly plant in Alabama, the German automaker celebrated the production launch of its luxury EQS sport utility vehicle at its Vance factory. Another EV, the EQE sport utility, is also being built there.

“There is serious horsepower here, and I think our auto industry is just getting started in this new age.”
In another milestone, Hyundai’s Alabama assembly plant has begun producing its first EVs — the electrified Genesis GV70 and a plug-in hybrid electric Santa Fe SUV. To get ready for that, Hyundai announced plans for a $300 million investment and 200 new jobs at its Montgomery factory.

To advance future EV production plans, supplier Hyundai Mobis is embarking on a project to open a $205 million EV battery module plant in Montgomery that will employ as many as 400 people.

These developments, as well as increasing activity in the EV supply chain, transmit the signal that Alabama’s auto sector is fully concentrating on tomorrow.

Alabama auto industry
Hyundai’s Alabama plant celebrated the production launch of the first Genesis Electrified GV70 SUV at a ceremony in Montgomery, Tuesday, Feb. 21, 2023. (Image: Hyundai Motor Manufacturing Alabama)

“In just a quarter century, Alabama’s auto industry has gone from zero to 100 mph, and I know that our five global automakers will continue to invest in their operations in the state to fully realize their potential,” said Greg Canfield, Secretary of the Alabama Department of Commerce.

“There is serious horsepower here, and I think our auto industry is just getting started in this new age.”

Combined, Alabama’s five global automakers — Mercedes, Honda, Hyundai, Toyota and Mazda — have invested around $15 billion in their operations in the state.

The investment — totaling $3.4 billion between 2020 and 2022 — continues to roll in. Hyundai recently announced plans for a new $290 million investment to prepare its Montgomery plant for production of a redesigned Santa Fe SUV.

Other major 2023 investment projects are being launched by suppliers Samkee in Tuskegee and Shinhwa in Auburn.

Driving Growth

With the next chapter of the industry’s future fast approaching, it’s obvious that Alabama’s auto industry remains a dynamic growth engine for the state’s economy.

Consider the powerful impact of the Mazda Toyota Manufacturing joint-venture assembly plant in Huntsville, which now produces a SUV for each of the automakers.

This $2.3 billion facility is not only bringing up to 4,000 direct jobs to Alabama but also generating strong economic ripples.

More than a dozen Mazda Toyota suppliers, logistics firms and support companies have established locations in Alabama, creating over 2,000 new auto-sector jobs. Combined, this supply-chain investment exceeds $725 million.

The seamless launch of Mazda Toyota Manufacturing shows that Alabama’s auto industry is ready for new challenges — and for whatever the future holds.

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