German automaker Mercedes-Benz Group AG has confirmed plans to relocate production of its top-selling GLC sport utility vehicle (SUV) from Germany to the United States, as global carmakers rethink their manufacturing strategies in response to rising tariffs on imported vehicles.
The move, reported by Bloomberg, comes amid growing pressure from the U.S. administration’s tariff policy, which raised duties on imported vehicles from 2.5% to 25%. While Mercedes has not explicitly linked the decision to the tariff increase, the timing aligns with escalating trade tensions that have prompted several auto manufacturers to consider expanding their U.S.-based operations.
“If you see what we want to achieve with volumes on this model, it makes sense to bring it to the U.S.,” said Jason Hoff, head of Mercedes-Benz North America, during a press briefing on Monday.
Production of the GLC SUV will begin in 2027 at the company’s Tuscaloosa, Alabama, plant. The GLC, currently manufactured in Germany, is Mercedes’ most popular import in the U.S., with more than 64,000 units sold in 2024—a 50% increase from the previous year. The hybrid model has a starting price of $49,250 (€44,193).
Earlier this month, Mercedes had announced that it would shift production of a “core segment vehicle” to the U.S., but had not named the specific model until now. The company has not yet disclosed whether the shift will involve additional investment or job creation at its U.S. plant.
The White House swiftly welcomed Mercedes’ decision, calling it a sign that the administration’s push to bring manufacturing back to American soil is working. Officials also pointed to a broader trend of global automakers ramping up U.S. operations. BMW is reportedly considering expanded production at its South Carolina plant, while Stellantis is preparing to reopen a facility in Illinois. Honda plans to shift Civic production from Japan to the U.S., and Hyundai has announced a $20 billion investment in its American operations.
The realignment reflects growing efforts by international automakers to avoid tariffs and meet local demand more efficiently by increasing U.S. manufacturing capacity.
While Mercedes has not confirmed the number of new jobs the move might create, the decision marks a significant step in reshaping the company’s U.S. manufacturing footprint and underscores the broader industry shift in response to evolving trade policies.
