By Luke Ramseth | Bloomberg’s Keith Laing contributed
Foreign-owned manufacturers built more vehicles in the United States last year than their rivals in Detroit, a first for the market that underscores major shifts in domestic auto production.
Non-U.S. automakers including Toyota Motor Corp. and Mercedes-Benz Group AG built more than 4.9 million cars in 2023, a jump of about 500,000 from the prior year, according to a report Tuesday from Autos Drive America and the American International Automobile Dealers Association.
The Detroit Three — General Motors Co., Ford Motor Co. and the former Fiat Chrysler, Stellantis NV — assembled 4.6 million in the market, a modest decline of about 150,000 vehicles from 2022.
Separately, U.S. electric-vehicle makers Tesla Inc., Rivian Automotive Inc. and Lucid Group Inc. produced 754,342 cars in the United States in the same period, according to the auto groups, which lobby for international car companies and their dealers.
The production shift “makes clear that international automakers are driving economic growth throughout the country,” Jennifer Safavian, chief executive officer of Autos Drive America, said in a statement.
International automakers have increased their United States production by more than 85 percent over the past 25 years, the report said, going from about 2.4 million to 4.9 million. Meanwhile, the Detroit Three’s domestic production has dropped by about half in that period as foreign-owned brands claimed larger shares of the rich U.S. market. Much of that Detroit Three production has headed elsewhere, including Mexico, Canada and China.
Foreign automakers now build vehicles across nine states. And they have either auto plants, component plants, and battery plants across 13 states. Almost all are in the South, with the major exceptions being Ohio and Indiana.
The report’s figures are “confirmation of the difficulty that the Big Three are having,” said Marick Masters, a professor emeritus of business at Wayne State University — including as they try to keep up amid the electric vehicle transition both domestically and in international markets. Foreign automakers, meanwhile, have been aggressive in recent years expanding their U.S. manufacturing footprints.
The growing production disparity between Detroit Three and foreign-owned vehicle production also underscores the necessity for the United Auto Workers to organize non-Detroit Three auto plants, a campaign that has been unfolding in recent months.
The Detroit union has been pushing to organize more foreign-owned plants, achieving success on its third try at a Volkswagen plant in Tennessee. But the UAW failed in a unionization vote in May at a Mercedes production complex in Alabama. The union has pledged to continue on and try to organize more foreign plants as well as domestic EV producers like Tesla.
The campaign to organize foreign automakers has “existential dimensions” for the UAW, Masters said: “As the position of the Detroit Three shrinks, the bargaining power of the UAW falls commensurately in the U.S.”
Sam Fiorani, AutoForecast’s vice president of global vehicle forecasting, said while 2023 was the first time the traditional Detroit Three was surpassed in production by foreign transplant automakers, another notable milestone came five years ago. That was when the Detroit Three fell to less than half the overall U.S. production market for the first time, making fewer cars, trucks and SUVs domestically than foreign and other U.S. automakers like Tesla combined.
In a statement, Ford said its manufacturing in the United States has remained robust. It pointed to figures showing it has consistently led other automakers in U.S. production volume in recent years, including assembling about 1.8 million vehicles domestically in both 2022 and 2023.
“The real story is that year after year, Ford leads all automakers by a wide margin when it comes to producing vehicles in America with American workers,” the automaker said in a statement sent by spokesperson Jess Enoch. “We expect to continue that legacy in 2024.”
Spokespeople for Stellantis and GM did not immediately respond to a request for comment on the report.
