Alabama, by nature, serves as a production hub for the automotive industry -- hosting manufacturing plants for Honda Motor Co., Hyundai Motor Co. and Mercedes-Benz, and an engine assembly plant for Toyota. The state is also home to more than 150 Tier 1 and Tier 2 suppliers, according to data compiled by Economic Development Partnership of Alabama.
"From a production cost point of view, the advantage would go to Alabama," Gregg Wassmansdorf, site-selection consultant and senior managing director of Newmark Knight Frank told Automotive News. "The other advantage that they would likely have, just based on historical precedent, is their ability to provide economic incentive. They have historically been very aggressive when it comes to incentives for automotive."
Wassmansdorf, whose team recently analyzed automotive assembly costs across Canada, the U.S. and Mexico, ranks Alabama in the top four of all jurisdictions across North America for their history of providing incentives for the automotive industry.
Because manufacturing margins are slim, Wassmansdorf said the site-selection team will try to optimize "every piece of infrastructure, and every bit of the labor pool and the labor cost environment and the incentive piece."