Alabama’s Automotive Industry

 

Alabama’s Automotive Industry

🚗 History & Milestones

  • 1997 marked a turning point with the first M‑Class SUV rolling off the line at Mercedes‑Benz U.S. International in Vance—Alabama’s first major auto plant—spurring what locals call “Before Mercedes” and “After Mercedes” 

  • Since then, Honda, Hyundai, and the joint Mazda–Toyota facility have followed, solidifying the state’s place among the top 5 automotive producers in the U.S. 

Major OEMs & Production

ManufacturerLocationLaunchProductsWorkforce
Mercedes‑Benz US InternationalVance1997GLE, GLS, EQE, EQS, Maybach SUVs~6,100 
Honda Manufacturing of AlabamaLincoln2001Odyssey, Pilot, Passport, Ridgeline~4,000
Hyundai Mfg AlabamaMontgomery2005Santa Fe, Tucson, Santa Cruz, Genesis EVs~3,000+
Mazda Toyota Manufacturing USAHuntsville2021Corolla Cross, CX‑50 (300K vehicles/year)~4,000
Toyota Motor Mfg Alabama (Engine Plant)Huntsville2003Corolla, Highlander, Tundra/Sienna engines~1,800

Together, these OEMs have a combined annual production capacity of around 1.3 million vehicles.

Suppliers & Infrastructure

  • Over 90–165 automotive suppliers operate in Alabama—from Tier 1 partners like MOBIS, Daewon, and Rehau, to smaller component manufacturers.

  • Between 2020–2023, Alabama attracted more than $5 billion in new supplier investment, generating some 8,500 jobs .

  • Notable investments include:

    • MOBIS: $52 million expansion in Montgomery,

    • Daewon America: $46.2 million in Opelika,

    • Rehau: $66 million in Cullman.

Economic Impact

  • The sector employs 50,000+ direct and double that indirectly, with payrolls well above the state average.

  • Vehicles are now Alabama’s #1 export, totaling $11.2 billion in 2023.

  • Automotive manufacturing contributes around 3–5% of Alabama’s GDP, with a large multiplier effect in logistics, services, and training .

Electrification & Innovation

  • EV Transition:

    • Mercedes invested $1 billion to produce EQ-series SUVs and batteries locally.

    • Hyundai added electrified Genesis GV70 and plug‑in hybrid Santa Fe; Mobis is building a $205 million battery plant in Montgomery .

  • Steel Supply Upgrade:

    • ArcelorMittal is building a $900 million plant in Calvert to produce advanced electrical steel, fueling the EV boom—opening by late 2027.

  • Workforce Readiness:

    • The state’s AIDT is building a $30 million EV training center in Decatur, atop Alabama’s Robotics Tech Park

Labor & Community

  • Unionization tensions:

    • The UAW has pushed to organize workers at the Vance Mercedes plant, but a 56% vote opposed unionizing in May 2024 

    • Workers had signed union cards, prompting both sides to ramp up their campaigns .

    • Mercedes countered with wage increases and anti-union messaging . The UAW plans to continue organizing efforts.

  • Economic incentives:

    • Right-to-work laws, workforce training, tax incentives, and a low-cost business environment have been major draws.

The Road Ahead

  • Alabama firmly sits among the U.S. auto manufacturing elite—top 5 in vehicle output, #1 in exports.

  • With vehicle electrification underway, homegrown EV production is ramping up in revenue, plants, and jobs.

  • Supplier ecosystems and major infrastructure investments, like the ArcelorMittal steel mill, position Alabama as a powerhouse in the clean-energy automotive supply chain.

  • Workforce development remains key, as industry and educational systems align to meet the next-gen manufacturing demands.

📌 Key Takeaways

  • OEM mix: Mercedes, Honda, Hyundai, Mazda–Toyota, plus Toyota engine plant.

  • Production muscle: ~1.3 M vehicles/year; exports ~11 B annually.

  • EV pivot: Billion-dollar plants, battery facilities, and advanced-material supply are in motion.

  • Economic engine: Tens of thousands of jobs, boosted GDP, and regional uplift.

  • Labor dynamics: Union drives face strong resistance; wage gains are part of the strategy.

Conclusion:
Alabama’s automotive industry stands as a testament to strategic investment—anchored by global OEMs, bolstered by local suppliers, and now accelerating into electrification. It’s not just about cars—it’s about jobs, innovation, and economic resilience. The journey from “First M‑Class” to “EV powerhouse” showcases a state putting full throttle into the future of mobility.

🚘 New (Franchised) Car & Truck Dealerships

As of mid-2024, Alabama had 277 franchised new‑car and truck dealerships, according to NADA (National Automobile Dealers Association) This slight discrepancy (277 vs. 300) likely reflects a drop in new-franchise openings or updated reporting periods.

The Automobile Dealers Association of Alabama (ADAA) officially represents 300 franchised new-car and truck dealers, per its 2025 member count

🚗 Used-Car Dealerships

According to IBISWorld (published within the past few months), Alabama's used-car dealer industry continues robustly, though exact dealership counts aren't publicly released.

The Alabama Independent Auto Dealers Association directory shows over 900 used-car dealers listed as members—indicative of more than 900 active operations.

Location: Dothan Alabama, USA