Mercedes to Invest $4 Billion in Alabama Plant

Mercedes said the funding is part of a larger $7 billion planned investment into the company’s U.S. operations by 2030.

Start of production for the new EQS SUV at Mercedes-Benz in Alabama in a file photo. Courtesy of Mercedes-Benz

German automaker Mercedes-Benz is planning to invest $4 billion in its Tuscaloosa County plant located in Alabama by the end of the decade, according to a March 31 statement by Made in Alabama, a website managed by the state’s Department of Commerce.

The announcement was made by company officials at the plant, where they unveiled two SUVs and marked the Tuscaloosa facility’s five-millionth manufacturing milestone.

“Today, the operation known as Mercedes-Benz U.S. International employs about 5,800 people and represents an investment of more than $7 billion. The plant regularly exports about 60 percent of its annual output,” the statement said.

Gov. Kay Ivey attributed Mercedes’s continued investment in the state to the expertise of the company’s Alabama workforce and its strategic vision.

Michael Schiebe, Board of Management member overseeing production, quality, and supply chain management, said the $4 billion investment plan from the company signals its strong commitment to the Alabama facility.

“We believe in Tuscaloosa. We are staying, we are growing, we are committed,” Schiebe said.

Mercedes had selected Alabama’s Tuscaloosa County for its first U.S. plant back in 1993, which established the foundation for the state’s automotive industry. Since then, several automakers, including Hyundai, Honda, and Mazda-Toyota, have set up vehicle assembly plants in Alabama.

In a March 31 statement, Mercedes said that the $4 billion funding for the Tuscaloosa plant is part of a larger $7 billion planned investment into the company’s U.S. operations by 2030.

In addition to the plant in Alabama, Mercedes has a presence in other states, including a van assembly facility in South Carolina, and research and development sites in California and Michigan. Last year, the company sold 303,200 passenger cars and 40,000 vans in the United States.

“In total, the company supports an estimate of nearly 160,000 jobs across the country, offering 10,600 direct jobs, of which around 7,500 are in assembly,” Mercedes said.

In an April 3 post on X, Transportation Secretary Sean Duffy highlighted Mercedes’ $4 billion investment.

“America is OPEN FOR BUSINESS,” Duffy wrote. “The TRUMP EFFECT is real!”

Mercedes’s investment follows the Trump administration’s imposition of tariffs on automobile and auto parts imports last year. In April 2025, President Donald Trump signed a proclamation to incentivize domestic automobile production and cut down reliance on imports of automobiles and their parts.

“In 1985, American-owned facilities in the United States manufactured 11.0 million automobiles, representing 97 percent of overall domestic (American- and foreign-owned) production of automobiles,” according to a White House Fact Sheet.

However, “in 2024, Americans bought approximately 16 million cars, SUVs, and light trucks, and 50 percent of these vehicles were imports (8 million).”

And even among the other 8 million vehicles assembled in the United States, the average domestic content is estimated at only 40 percent, the White House said.

Trump’s auto tariffs were expected to trigger a steady and significant increase in vehicle prices. However, the average transaction price (ATP) for a new vehicle in February was up 3.4 percent from a year earlier, industry expert Cox Automotive said in a March 10 statement.

The ATP has remained in a range of around $45,000 to $50,000 since last year.

Moreover, total new vehicle sales in 2025 are estimated to be 16.3 million units, up 1.8 percent on an annual basis and the best sales year since 2019, according to a Jan. 7 statement from Cox.

In addition to Mercedes, other major automakers have also announced plans to invest in the United States over the past few months.

In an April 2 X post, the official White House account said that Hyundai would invest $26 billion in the United States, creating 25,000 new direct jobs.

“More than 80 percent of Hyundai vehicles sold in America will be MADE IN AMERICA!”

The company made the initial investment announcement in August last year, committing $26 billion over 2025–2028.

In October 2025, Stellantis announced $13 billion in investments to grow in the United States, which it said was the “largest single investment in Company’s 100-year history.” A month later, in November, Toyota Motor Corporation announced plans to invest up to $10 billion in its U.S. operations.