Mercedes selects AM General to make SUVs in the US

  • By Dee-Ann Durbin Associated Press
  • Tuesday, January 27, 2015 1:29pm
  • Business

DETROIT — Military and commercial vehicle maker AM General will start making Mercedes-Benz SUVs this summer under a new, multi-year contract with the German automaker.

AM General will make the R-Class SUV at its commercial vehicle plant in Mishawaka, Indiana. The R-Class, which comes with six or seven seats, was briefly sold in the U.S. but has been sold exclusively in China since 2013.

Mercedes doesn’t release sales numbers for individual models in China, but in a presentation last year the company said it sold 12,700 R-Class SUVs in 2013.

Mercedes says it needs to move production of the R-Class from its Tuscaloosa, Alabama, assembly plant to make way for a new SUV, the GLE Coupe, and increase production of other models to meet growing U.S. demand. Its U.S. sales rose 6.5 percent last year, faster than the industry average. Sales of its M-Class SUV, which is also made in Alabama, rose 13 percent.

“Plant Tuscaloosa needs all available production capacities for this segment,” said Jason Hoff, President and CEO of Mercedes manufacturing in the U.S.

AM General spokesman Jeff Adams said his company, which is based in South Bend, Indiana, will hire and train several hundred workers to make the R-Class. The Mishawaka plant currently makes the MV-1, a wheelchair-accessible van. The plant is capable of producing 70,000 vehicles per year.

AM General is Mercedes’ first and only contract manufacturer in the U.S., Adams said. But the company has made vehicles for other automakers. Mercedes’ SUVs will be manufactured in the same plant where AM General built the Hummer H2, which it made for General Motors Co. until January 2009.

AM General also makes military vehicles at a second plant on the Mishawaka site. The company employs 1,500 workers at those plants plus others in Ohio and Michigan.

The agreement solves an increasingly difficult dilemma for automakers, who want to meet growing U.S. demand but are loathe to open more plants after shutting many down during the recession. U.S. auto sales rose 57 percent between 2009 and 2014.

The agreement also moves the work from a non-union plant to a union-represented one. The Alabama plant is Daimler AG’s only non-union plant in the world, according to the United Auto Workers union, which has been trying to organize workers there. AM General’s workers are represented by the UAW.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Business

Black Press Media operates Sound Publishing, the largest community news organization in Washington State with dailies and community news outlets in Alaska.
Black Press Media concludes transition of ownership

Black Press Media, which operates Sound Publishing, completed its sale Monday (March 25), following the formerly announced corporate restructuring.

Maygen Hetherington, executive director of the Historic Downtown Snohomish Association, laughs during an interview in her office on Thursday, Feb. 15, 2024, in Snohomish, Washington. (Ryan Berry / The Herald)
Maygen Hetherington: tireless advocate for the city of Snohomish

Historic Downtown Snohomish Association receives the Opportunity Lives Here award from Economic Alliance.

FILE - Washington Secretary of State Steve Hobbs poses in front of photos of the 15 people who previously held the office on Nov. 22, 2021, after he was sworn in at the Capitol in Olympia, Wash. Hobbs faces several challengers as he runs for election to the office he was appointed to last fall. (AP Photo/Ted S. Warren, File)
Secretary of State Steve Hobbs: ‘I wanted to serve my country’

Hobbs, a former Lake Stevens senator, is the recipient of the Henry M. Jackson Award from Economic Alliance Snohomish County.

Mark Duffy poses for a photo in his office at the Mountain Pacific Bank headquarters on Wednesday, Feb. 14, 2024 in Everett, Washington. (Annie Barker / The Herald)
Mark Duffy: Building a hometown bank; giving kids an opportunity

Mountain Pacific Bank’s founder is the recipient of the Fluke Award from Economic Alliance Snohomish County.

Barb Tolbert poses for a photo at Silver Scoop Ice Cream on Thursday, Feb. 29, 2024 in Arlington, Washington. (Annie Barker / The Herald)
Barb Tolbert: Former mayor piloted Arlington out of economic brink

Tolbert won the Elson S. Floyd Award, honoring a leader who has “created lasting opportunities” for the underserved.

Photo provided by 
Economic Alliance
Economic Alliance presented one of the Washington Rising Stem Awards to Katie Larios, a senior at Mountlake Terrace High School.
Mountlake Terrace High School senior wins state STEM award

Katie Larios was honored at an Economic Alliance gathering: “A champion for other young women of color in STEM.”

The Westwood Rainier is one of the seven ships in the Westwood line. The ships serve ports in the Pacific Northwest and Northeast Asia. (Photo provided by Swire Shipping)
Westwood Shipping Lines, an Everett mainstay, has new name

The four green-hulled Westwood vessels will keep their names, but the ships will display the Swire Shipping flag.

A Keyport ship docked at Lake Union in Seattle in June 2018. The ship spends most of the year in Alaska harvesting Golden King crab in the Bering Sea. During the summer it ties up for maintenance and repairs at Lake Union. (Keyport LLC)
In crabbers’ turbulent moment, Edmonds seafood processor ‘saved our season’

When a processing plant in Alaska closed, Edmonds-based business Keyport stepped up to solve a “no-win situation.”

Angela Harris, Executive Director of the Port of Edmonds, stands at the port’s marina on Wednesday, Jan. 24, 2024, in Edmonds, Washington. (Ryan Berry / The Herald)
Leadership, love for the Port of Edmonds got exec the job

Shoring up an aging seawall is the first order of business for Angela Harris, the first woman to lead the Edmonds port.

The Cascade Warbirds fly over Naval Station Everett. (Sue Misao / The Herald file)
Bothell High School senior awarded $2,500 to keep on flying

Cascade Warbirds scholarship helps students 16-21 continue flight training and earn a private pilot’s certificate.

Rachel Gardner, the owner of Musicology Co., a new music boutique record store on Thursday, Jan. 18, 2024 in Edmonds, Washington. Musicology Co. will open in February, selling used and new vinyl, CDs and other music-related merchandise. (Olivia Vanni / The Herald)
New Edmonds record shop intends to be a ‘destination for every musician’

Rachel Gardner opened Musicology Co. this month, filling a record store gap in Edmonds.

MyMyToyStore.com owner Tom Harrison at his brick and mortar storefront on Tuesday, Sept. 6, 2022 in Everett, Washington. (Olivia Vanni / The Herald)
Burst pipe permanently closes downtown Everett toy store

After a pipe flooded the store, MyMyToystore in downtown Everett closed. Owner Tom Harrison is already on to his next venture.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.