Daimler plans $1B investment in Ala. to build EQ electric utility vehicles
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September 21, 2017 01:00 AM

Daimler plans $1B investment in Ala. to build EQ electric utility vehicles

Christiaan Hetzner
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    The Vance plant builds the Mercedes GLE off-roader, formerly called the M class, along with the GLE Coupe crossover, the larger GLS SUV and the C-class sedan.
    Carmakers announce $9.5 billion in U.S. investments so far in 2017

    Since January, automakers have announced investments totaling $9.5 billion in U.S. plants, creating or retaining more than 12,000 jobs. By company, the investments from the United States and abroad are:

    * General Motors: $1 billion in various plants to keep or create 1,500 jobs

    * Fiat Chrysler Automobiles: $1 billion in Ohio and Michigan to create 2,000 jobs

    * Hyundai Motor Co.: $1 billion in various plants; new jobs to be determined

    * Ford Motor Co.: $1.2 billion in Michigan, new jobs to be determined

    * Toyota Motor Corp.: $1.3 billion in Kentucky; no new jobs

    * BMW: $600 million in South Carolina to create 1,000 jobs

    * Toyota and Mazda Motor Corp.: $1.6 billion to create 4,000 jobs; site to be determined

    * Honda Motor Co.: $267 million in Ohio to create 300 jobs

    * Volvo Car: $500 million in South Carolina to create 2,500 jobs

    * Daimler AG: $1 billion in Alabama to create 1,300 jobs

    Source: Reuters

    TUSCALOOSA, Ala. -- Daimler AG said it will invest an additional $1 billion in its U.S. factory in Vance, Ala., expanding the 20-year-old site to build fully electric utility vehicles under its EQ subbrand along with their battery packs.

    The expansion is part of Daimler's strategic plan to electrify its entire range of Mercedes-Benz light vehicles by 2022, offering customers at least one electrified alternative in each segment to bring its total to more than 50 electrified vehicles.

    It also takes place as German automakers have been the target of criticism from President Donald Trump over what he has said are unfair trade practices, singling out the success of Mercedes and rival BMW in the U.S. market as evidence.

    "With production locations for EVs and batteries in Europe, China and now the U.S., our global network is ready for the era of electric vehicles," said Markus Schaefer, member of the divisional board of Mercedes-Benz Cars responsible for production and supply chain. "Thanks to our plant modernization in Tuscaloosa, we will be able to quickly ramp up U.S. production of EQ models."

    Daimler showed off an EQ concept SUV last year at the Paris auto show. It was described as a "near-production" vehicle. The EQ line eventually will consist of cars, crossovers and SUVs.

    Construction work on the 1 million-square-foot plant is expected to begin in 2018, with production of EQ vehicles slated to start at the beginning of the next decade. At the time of launch, these models will also feature the latest in autonomous driving technology, according to Daimler.

    A battery pack plant, the company's fifth, will be located in a separate facility nearby.

    "With production locations for EVs and batteries in Europe, China and now the U.S., our global network is ready for the era of electric vehicles," Schaefer said.

    Final details of the plans are still being worked on in partnership with the Alabama government, but it is expected that the investments will create more than 600 jobs. Daimler did not quantify the capacity of the battery plant, nor the expected output of the vehicle plant after the latest $1 billion investment.

    The Vance plant builds the Mercedes GLE off-roader, formerly called the M class, along with the GLE Coupe crossover, the larger GLS SUV and the C-class sedan. Output at the plant, in which Daimler has already invested over $5 billion to date, surpassed 310,000 vehicles last year.

    Reuters
    Daimler showed off an EQ concept SUV last year at the Paris auto show. It was described as a "near-production" vehicle.

    The latest additional $1 billion investment comes close on the heels of a decision in September 2015 to pour $1.3 billion into the Alabama site, including a new body shop. This would allow the operation to build the next generation of Mercedes utility vehicles.

    "Looking back on 20 years of production, the Mercedes-Benz plant in Tuscaloosa has been a success story from the beginning. We are now continuing this story with a clear vision for the era of electric mobility," said Jason Hoff, CEO of Mercedes-Benz U.S. International.

    Until now, Daimler has only confirmed EV production at its three German factories in Rastatt, Bremen and Sindelfingen but it said in May that it would build vehicles to be sold under its EQ all-electric subbrand throughout its global network, depending on local demand.

    "Future EQ models can be integrated in the series production of existing Mercedes-Benz plants on four continents," it said at the time.

    CA112165921.PDF

    Daimler press release

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    Key facts

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    Daimler in the U.S.

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