Auto manufacturers have been progressively building their new electric vehicle (EV) plants in southern states—marking a sizable migration from Detroit.
Key Details
- Many automakers are building their new plants in southern states like Tennessee, Kentucky, Georgia, Alabama, South Carolina, and Texas, in addition to new plants in rural Michigan, Ohio, and Indiana.
- $110 billion has already been invested to build these new plants since 2018, bringing tens of thousands of jobs to small towns like Stanton, Tennessee—with a current population of 400.
- The nonprofit Center for Automotive Research claims half of EV-related development investments are being poured into the American South, in addition to the Great Lakes region.
- Detroit will remain a hub for research and development, as well as the executive centers for their business, while manufacturing spreads across the country, according to The Wall Street Journal.
Key Details
On August 16, 2022, President Joe Biden signed the Inflation Reduction Act, signing $369 billion of clean energy subsidies and tax credits into law. Automakers have responded to increases in tax credits and government demands to phase out gas-powered vehicle production by 2035 by introducing new lines of EV cars and trucks.
With EV demand slowly increasing, automakers are ramping up their production facilities to be able to fulfill the needs and demands of an all-EV economy in the coming decades. These new facilities in the American South have many advantages, including easy access to land for new facilities, quick access to surrounding suppliers, an eager workforce, and lower energy costs. States like Tennessee also have the advantage of relying on the Tennessee Valley Authority—one of the largest clean energy grids in the country.
These new facilities are a boon to small southern cities, which are now facing the realities of thousands of new jobs flowing into their small communities. Stanton Mayor Allan Sterbinsky tells The Wall Street Journal, “It’s tremendously overwhelming, just everything that has to be done.” The new Ford Motor plant is expected to open in 2025 and produce 500,000 electric trucks yearly, leaving the town little time to prepare for a flood of 6,000 new citizens.
