- Mercedes shifting GLC production to US to avoid costly import tariffs.
- Alabama plant gets huge investment as part of $7 billion US project.
- Compact GLC will gradually move Stateside, reportedly starting in ’27.
While American drivers now being asked to pay $4 per gallon are trying to get to grips with the fallout from the Iran conflict, automakers are still dealing with one of President Trump’s earlier initiatives: tariffs. Mercedes’ solution to stinging import duties is to shift production of its best-selling vehicle from Germany to the US.
The vehicle we’re talking about is the combustion GLC, a compact luxury SUV that quietly does massive numbers. It’s not flashy like an S-Class or AMG GT, but it’s hugely important. In fact, it accounts for almost 25 percent of the brand’s US sales, which makes every import fee paid on cars shipped from the Bremen plant in Europe hurt just a little more.
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Right now, those SUVs arrive from Europe with a hefty 15 percent tariff attached. That extra cost adds up quickly when you’re selling around 70,000 units across the US and Canada every year. So rather than keep paying the bill, Mercedes is taking a different route and bringing production stateside.
The plan is to build North American GLCs at its long-running Alabama factory near Tuscaloosa, where the bigger GLE and GLS are already produced. The shift won’t happen immediately, though. Production is expected to begin in the “next few years,” Mercedes says, which AutoForcast Solutions claims means late 2027. But the automaker’s CEO, Ola Kallenius, told Automotive News that GLC production won’t be fully up to speed until 2029.
$7 Billion Investment
To make it happen, Mercedes is pouring $4 billion into the facility, part of a $7 billion investment in its US operations between now and the end of the decade. It hopes to boost Alabama’s production capacity from its current 250-300,000 annual units to around 340,000, Auto News reports. It says the plant has been under-utilized recently due to poor sales of the electric EQS SUV, which is also built there, but is being sent packing to Germany to make room for the GLC.
Most of the GLCs produced in Alabama will stay in North America, the report notes, but GLEs and GLSs are already shipped around the globe from Tuscaloosa.
