Study: Honda had a $12 billion economic impact on Alabama in 2018

Study: Honda had a $12 billion economic impact on Alabama in 2018
Mike Oatridge,Senior Vice President of Honda Manufacturing of Alabama, speaks during a news conference Wednesday at Vulcan Park and Museum in Birmingham. (Dennis Washington / Alabama NewsCenter)

Honda’s auto plant in Talladega County continues to be an economic engine for Alabama, revving the state’s economy by $12.1 billion in 2018 and creating 45,674 jobs in the state.

The Economic Development Partnership of Alabama released the figures Wednesday from a report it commissioned by the Center for Business and Economic Research at the University of Alabama. That report found Honda Manufacturing of Alabama (HMA) is responsible for 5.4% of the state’s total economic output.

“That’s huge,” said Sam Addy, director of UA’s Center for Business and Economic Research. “When you go to most states, you won’t find a network that has as much of an impact as Honda.”

Honda leads Alabama in automobiles produced from Alabama NewsCenter on Vimeo.

A summary of the economic impacts of Honda Manufacturing of Alabama. (contributed)

In 2018, HMA employed 5,321 at its Lincoln manufacturing facility, up from 4,000 in 2014. When you add the plant’s direct and indirect impact on employment, including those employed at the plant’s 26 Tier-1 suppliers, HMA accounted for 45,674 jobs, up from 43,339 four years ago.

“It’s more than just a factory,” said Mike Oatridge, senior vice president of HMA. “It’s a lot of people, and it’s not just our factory, but several factories around the state. What’s inside them is what’s important. Without the people here in this state, we would not have the success we have today.”

How HMA production affects the Alabama economy. (contributed)

HMA and its Tier-1 suppliers accounted for $867.2 million in earnings in 2018 and generated $202.9 million in income, sales and property taxes for state and local governments.

“It’s been a great partnership between company, local communities where it operates and its supply chain operates, and the state of Alabama,” said Steve Sewell, executive vice president for EDPA. “Honda has always been gracious to acknowledge the support they get and, at the same time, be willing to offer testimonials about their positive experience in the state and promote Alabama as a destination for other great, global companies. We really appreciate their partnership in economic development.”

HMA recently produced its 5 millionth vehicle, more than any other auto manufacturer in the state. The plant assembles four vehicles: the Odyssey, Passport, Pilot and Ridgeline.

“Five million vehicles is a lot of vehicles, and we’re proud of every single one of them,” Oatridge said. “The hands of an Alabama worker were on those, making sure they met the quality expectations of our customers. It’s not really the volume but the quality that matters the most.”

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