Michigan’s auto industry, which supports more than one in five private-sector jobs in the state, faces growing competition from other states and global manufacturers as electric vehicle demand shifts and production strategies evolve.
A new report from MichAuto outlines mounting pressure on the state’s automotive sector, citing increased global competition, fluctuating EV demand, and expanded manufacturing investment in other regions. Recent restructuring announcements from major automakers further underscore those pressures.
The 2025 State of Automobility Report, released by the industry advocacy group MichAuto, examines Michigan’s standing in the global automotive market. The report states that Michigan continues to lead the country in automotive research and development and maintains one of the most concentrated supplier networks in the world.
But the study also highlights accelerating competition abroad. China’s vehicle production has increased by nearly 500% since 2004, according to the report.
“Since 2004, the U.S. share of vehicle production has declined to 11% as of 2024. Today, China produces three times as many vehicles as the U.S. and accounts for 34% of the total,” the report states.
Glenn Stevens Jr., executive director of MichAuto, framed the moment as a turning point.
“We find ourselves in an era defined by rapid automation, the digital economy, shifts in global supply chains, and trade war gamesmanship,” Stevens said. “Michigan’s path forward demands a bold, cohesive agenda that positions us to innovate and lead the industry.”
The report calls for investment in advanced manufacturing, mobility technology, and workforce development to sustain Michigan’s share of global production as industry models shift.
Major automakers have already begun adjusting their strategies.
Ford Motor Co. announced it would take a multibillion-dollar charge to restructure parts of its electric vehicle strategy. The company said it would rebalance investments across electric, hybrid and internal combustion vehicles, as well as energy storage systems, following slower-than-expected growth in EV demand.
General Motors also announced layoffs affecting approximately 1,700 workers at plants in Michigan and Ohio, citing production adjustments and inventory levels in its electric vehicle segment.
Meanwhile, Southern states, including Tennessee, Georgia, and North Carolina, have expanded electric vehicle and battery manufacturing facilities in recent years, drawing new investment into the region.
Michigan’s automotive sector supports a broad employment base that extends beyond metro Detroit into central and western Michigan. The industry includes engineering, production, logistics, and research roles and remains closely tied to middle-income employment.
As production strategies evolve, workforce composition has become a central issue.
Michigan’s Hispanic and Latino labor force has grown steadily over the past two decades. Data from the Michigan Center for Data and Analytics shows the Hispanic workforce increased from approximately 179,500 workers in 2000 to 284,000 in 2023.
Manufacturing accounts for 22% of Hispanic employment in Michigan, making it the state’s largest employer of Latino workers. Because automotive production falls under manufacturing, Hispanic and Latino workers make up a significant portion of the industry’s workforce and are employed in manufacturing at higher rates than in any other sector.
A 2023 study from the Center for Automotive Diversity, Inclusion, and Advancement (CADIA), titled “DEI Industry Study: Driving Diversity — Unlocking the Power of Diverse Workforces for the Future of the Transportation Industry,” found that Hispanic and Latino workers hold strong representation in production and operations roles within the transportation sector but remain underrepresented in executive and senior leadership positions.
The State of Automobility report also identifies workforce alignment as a key concern.
“As the automotive industry evolves, demands for skilled professionals have intensified,” the report states. “However, the supply of qualified talent isn’t keeping pace. The shortfall between graduates and job openings poses a significant threat to the industry’s competitiveness and innovation.”
The report notes a more than 30% increase in demand for automation-related roles, along with a talent gap of more than 3,700 positions in industrial engineering and nearly 2,000 in mechanical engineering.