Mercedes-Benz confirms plans to assemble the GLC SUV at its Alabama plant starting in late 2027, a move influenced by US tariffs and the need for localised production to meet North American demand.
Mercedes-Benz has announced plans to commence production of its GLC crossover SUV at its Vance, Tuscaloosa, Alabama plant by late 2027, a manufacturing move aimed at mitigating the impact of recent US tariffs and aligning with shifting market demands.
The decision follows the implementation of a 25% tariff on imported vehicles by the Trump administration in April 2025, a policy designed to encourage domestic manufacturing. Despite Mercedes-Benz’s significant US presence, including a workforce of approximately 11,000 and a network of over 400 suppliers, the company faces an estimated $1.7 billion in additional costs due to these tariffs.
Currently, the GLC is produced in Bremen, Germany, and is Mercedes-Benz’s best-selling model in the US, with 64,163 units sold last year, accounting for nearly 20% of the brand’s US volume, excluding vans. The compact premium crossover segment in the US has seen significant growth, with deliveries rising 14% to 425,294 units last year, nearly triple the segment’s volume a decade ago.
”Mercedes-Benz could build more than 50,000 GLCs in the first full year of production at the Alabama plant. The nearly 30-year-old assembly plant operates at a profitable 87% of its 305,000-vehicle annual capacity”
Addition of GLC into Alabama plant will not require a physical plant expansion
“You want to be able to grow in [major global] markets … be close to the customer and … react to the marketplace in a quick manner,” said Mercedes-Benz CEO Ola Källenius during a May 12 media roundtable.
The Alabama facility, already a hub for Mercedes-Benz SUV manufacturing - including models such as the GLE, GLS, and their electric variants - will add the GLC line without requiring a physical expansion of the plant. “The GLC expands Tuscaloosa’s footprint as an SUV factory,” noted Mercedes-Benz North America CEO Jason Hoff.
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A significant move for North American vehicle production
While Mercedes-Benz has not disclosed the specific investment amount for this expansion, Källenius described it as “significant.” The move is part of a broader strategy to strengthen US manufacturing capabilities, which also includes a major investment in light commercial vans by enhancing its Sprinter van assembly plant in Charleston, South Carolina.
AutoForecast Solutions projects that Mercedes-Benz could build more than 50,000 GLCs in the first full year of production at the Alabama plant. The nearly 30-year-old assembly plant operates at a profitable 87% of its 305,000-vehicle annual capacity.
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Mercedes-Benz’s shift to localised production reflects a broader industry trend, as automakers adapt to changing trade policies and consumer preferences. The company’s decision to produce the GLC SUV in Alabama underscores its commitment to the US market and its strategy to navigate the complexities of global manufacturing in an era of increasing protectionism.
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