Mercedes-Benz to pour $4B into Alabama plant as Trump tariffs reshape US auto strategy
Mercedes North America CEO Jason Hoff says localizing production for high-volume models 'just makes good business sense' given tariffs
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German automaker Mercedes-Benz said on Tuesday it will invest $4 billion at its Alabama plant through 2030 to boost SUV production as it seeks to address significant U.S. auto tariffs.
In total, luxury automaker Mercedes-Benz said it plans to invest more than $7 billion in U.S. operations in the coming years.
The company is moving up to 500 jobs from various locations across the country into a new, state-of-the-art research and development hub in Atlanta.
Automakers face steep tariffs imposed by President Donald Trump on imported vehicles and parts.
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Mercedes-Benz is planning to invest $4 billion in its Alabama manufacturing facility. (Carol M. Highsmith/Buyenlarge/Getty Images)
Mercedes-Benz said last year it would shift production of its GLC SUV from Germany to Tuscaloosa, Alabama.
In February, Mercedes said group operating profit more than halved to 5.8 billion euros ($6.9 billion) in part due to 1 billion euros in tariff costs.
Mercedes said U.S. passenger car sales rose by 1% to 303,000 last year.
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| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MBGYY | MERCEDES-BENZ GROUP AG | 15.25 | +0.52 | +3.53% |
Mercedes North America CEO Jason Hoff said in a recent interview with Reuters that the planned move of the GLC is in part because of tariffs.
Having localized production for the biggest volume products "just makes good business sense," said Hoff, citing the influence of tariffs.
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Early last year, Mercedes-Benz said that lower tariffs – or even zero-zero tariffs – between the U.S. and European Union could allow the company to step up investment in the U.S. even further.
Mercedes-Benz is planning to expand its footprint in the U.S. as a means of mitigating tariff costs. (Elijah Nouvelage/Reuters)
Mercedes-Benz CEO Ola Källenius said in February 2025 that the company has "been operating in the United States for more than 120 years" and detailed the company's American footprint.
"We have two large operations on the passenger car side, one in Alabama and one in South Carolina," Källenius said. "Directly, we employ more than 11,000 people in the United States. If you would count in all the suppliers and the ones that kind of are dependent on those final assembly jobs, the usual calculation is roughly 1-to-10, so another 100,000 jobs are associated with those plants. Our dealer partners, strong private investors around the country, employ 28,000 people and then again, they have a residual effect. "
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"The several hundred thousand jobs, tax revenue, etc. is the Mercedes-Benz footprint in the U.S.," he explained. "What's the point I am making? The point is we're also an American company. Yes, we have our headquarters in Germany and our European origins, but we feel American."
Reuters contributed to this report.