Mercedes-Benz announced plans today to invest an additional $1 billion in its Alabama operation, where it will set up electric vehicle production and build a battery plant.
In addition, the German automaker will expand its logistics activities in the U.S. with a new Global Logistics Center and a new after-sales North American parts hub to be built in nearby Bibb County.
Altogether, Mercedes’ new investment in Alabama is expected to create more than 600 jobs and upgrade a plant that the company already describes as one of the world’s “smartest” manufacturing facilities.
The automaker announced its expansion plans at a ceremony today at its assembly plant in Vance, where it began production 20 years ago. Top Mercedes executives joined state leaders and local officials at the event.
Mercedes said its Alabama plant, which is in the midst of a $1.3 billion expansion project announced two years ago, will shape of the future of electric mobility worldwide as it integrates electric vehicles into the production lineup.
“With this $1 billion investment, we are significantly growing our manufacturing footprint here in Alabama, while sending a clear message to our customers across the U.S. and around the world: Mercedes-Benz will continue to be on the cutting edge of electric vehicle development and production,” said Markus Schafer, member of the divisional board of Mercedes Cars, production and supply chain.
Mercedes will begin producing SUV models bearing its EQ brand in Alabama at the beginning of the next decade. The Alabama expansion is part of a global initiative by the automaker to offer more than 50 electric vehicles variants by 2022.
“EQ meets Bama,” Schafer said.
Today, Mercedes’ Tuscaloosa County assembly plant produces the GLS, GLE and GLE Coupé sport utilities, as well as the C-Class sedan. As part of the 2015 expansion, the plant is being prepared to produce modern plug-in hybrids.
Record of expansion
Mercedes’s original investment in Alabama was $325 million. Once the expansion announced today is complete, the figure will stand at $6.8 billion.
“The fact that Mercedes-Benz continues to expand its operations in Alabama makes a powerful statement about the quality of the automaker’s workforce in the state, and underscores that we are achieving our goal of ensuring businesses in Alabama don’t just survive, but thrive,” Gov. Kay Ivey said.
“For the past two decades, MBUSI has been a tremendous partner in the growth of our state, and we look forward to strengthening those bonds in the years to come,” she added.
Construction of the 1 million-square-foot battery facility in Tuscaloosa is expected to begin next year, and it should be operational in a couple of years.
When it opens in 2019, the Global Logistics Center in Bibb County, five miles away from Mercedes’ assembly plant, will support the company’s worldwide logistics operations for the products it makes in Alabama. It will supply overseas assembly plants with kits used to produce vehicles for local markets.
The new after-sales North American hub on the same site will provide spare parts to markets around the world. It should become operational in late 2020.
“This is an exciting day for MBUSI and our entire team here in Alabama,” said Jason Hoff, president and CEO of Mercedes-Benz U.S. International, as the company’s Alabama operation is formally known.
‘Catalyst for growth’
Alabama officials welcomed the investment from Mercedes, whose Tuscaloosa plant produced more than 310,000 vehicles in 2016. It employs more than 3,700 team members and supports more than 7,000 jobs on the 1,000-acre plant site.
“Mercedes-Benz has been a powerful catalyst for growth in Alabama for two decades, and the company’s decision to produce electric vehicles at its Tuscaloosa plant and to expand its global logistics operation in the state reinforces the company’s vital role in Alabama’s future,” said Greg Canfield, secretary of the Alabama Department of Commerce.
“This initiative, which will bring cutting-edge technology and new jobs to the state, is another great chapter in our relationship with the automaker,” he added.
This story originally appeared on the Alabama Department of Commerce’s Made in Alabama website.