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Mercedes-Benz's decision to build electric vehicles in Alabama could push production of the C-class sedan out of the country.
"We will see" whether C-class assembly moves elsewhere, Mercedes global sales chief Britta Seeger told Automotive News.
Mercedes parent Daimler AG in September said it would invest $1 billion in the Vance, Ala., plant to assemble fully electric utility vehicles under its EQ subbrand. U.S. production of the EQ line is expected to begin in 2020 with an electric crossover the size of the Mercedes GLE. The plant assembles the GLE and GLE Coupe, the larger GLS SUV and the C-class sedan.
"The most important point for us was to make sure we have the EQ production in the U.S.," Seeger said. "If you have electric mobility, it makes sense to go very regional because you want to avoid huge transportation."
Mercedes predicts the EQ line could account for 15 to 25 percent of its global
sales by 2025.
If that happens, the automaker may have to move production of other vehicles, such as the C-class sedan, from Alabama. When Daimler made the EQ announcement, Mercedes production boss Markus Schaefer said the plant in Vance already was at its ideal size, with 2016 production of just more than 300,000 vehicles.
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IHS Markit expects the C-class sedan to move out of Alabama when redesigned, said Joe Langley, IHS Markit's associate director of North America forecasting.
That redesign is expected in 2021.
It's unclear where the U.S. production volume would end up. In addition to Alabama, Mercedes makes the C class in South Africa and Germany.
LMC Automotive has the C-class sedan in its forecast for assembly in Alabama beyond the next redesign. But a move from Alabama at that point also is plausible, said Jeff Schuster, LMC's senior vice president of forecasting.
"We don't see the EQ volume there supporting where you'd have to move the C class," Schuster said.
If the automaker plans for more volume and wants to keep the plant focused on utility vehicles, that could push out the C class, he said.
Seeger said the company has not yet decided whether to move the C-class sedan.
"If we would stop, then, for sure, you would need to import," Seeger said. But "it's not a decision we are taking currently."
Mercedes could wait until early 2019 to make the final call, Schuster said.
Mercedes started building the C class in Vance in 2014, when the sedan was last redesigned.
The sedan represents about 20 percent of the plant's production, according to LMC. Mercedes built about 72,000 C-class sedans in 2016 in Alabama and is on track for 57,000 in 2017, Schuster said. Most of those vehicles go to U.S. dealerships.
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