U.S Automotive Manufacturing Market Trends Report - May 2025
Last Updated: May 13, 2025
In April 2025, U.S. auto manufacturing lost thousands of jobs—but not without a twist. While employment shrank, wages surged, signaling a major shift in the industry. Powered by new tariffs, rising labor costs, and the EV transition, the landscape is changing fast. So, how many auto manufacturing jobs are available in the U.S. right now? Fewer than before—and where they are is shifting, too.
Here’s what the latest BLS data reveals—and what it means for job seekers and manufacturers.
Key Takeaways
Fewer Jobs Available: Down 20,800 from last April to 997,300. Most losses came from parts manufacturing.
Regional Divide Deepens: Michigan and California lost thousands of jobs; Alabama and Kentucky saw small but steady gains.
Wages Up: Average hourly pay climbed $2.52 to $32.81, led by union contracts and demand for skilled labor.
Work Hours Down: The average workweek dropped 0.8 hours, suggesting leaner or slower operations.
Trade Pause Could Help: A new U.S.-China tariff truce may ease cost pressures—but it’s temporary.
How Many Auto Manufacturing Jobs Are Available in the U.S.?
The short answer: fewer than last year.
The U.S. auto manufacturing industry employed 997,300 workers in April 2025, according to seasonally adjusted data from the Bureau of Labor Statistics. That’s a drop of 20,800 jobs from April 2024 and down 4,700 from March—marking another month of contraction in the sector.
The sharpest losses hit parts manufacturing, which fell to 539,600 jobs, down 19,100 from a year ago. This reflects falling demand for traditional components—especially internal combustion engine parts—alongside recent supply disruptions.
Vehicle assembly held steady at 295,500 jobs, while motor vehicle body and trailer manufacturing added a modest 1,000 jobs, reaching 165,400.
Regional Trends: Northern Job Losses, Southern Growth
Where jobs are shrinking is just as important as how many are gone. The divide between legacy manufacturing states and newer Southern hubs is growing:
Michigan lost 2,400 vehicle manufacturing jobs (now 45,000) and 6,500 parts jobs (now 113,800) since last March.
California dropped 7,100 vehicle jobs, falling to 25,000—likely due to high production costs and shifting strategies.
Alabama gained 400 vehicle manufacturing jobs (23,000 total), while Kentucky added 200 (now 24,400), benefiting from EV and battery plant expansions.
States like Indiana and Ohio, traditional strongholds in parts production, lost 1,800 and 1,400 jobs respectively—highlighting the uneven impact of the industry’s transformation.
Southern Momentum Builds: Mercedes-Benz Expands in Alabama
In early May, Mercedes-Benz announced it will produce a new core-segment vehicle at its Tuscaloosa, Alabama plant starting in 2027, deepening its footprint in the region. While details were limited, the company described the decision as part of its broader effort to optimize production and respond to market shifts.
Mercedes already employs over 6,000 people at the plant and supports approximately 60,000 supplier and service jobs throughout Alabama. This move highlights how Southern states continue to attract manufacturing investments, especially as automakers localize operations in response to tariffs and global disruptions.
Southern states are gaining ground as key manufacturing hubs—while higher-cost Northern regions face job losses and slower growth.
Wages Climb Higher—Even as Jobs Disappear
The bright spot: wages are rising.
Average hourly earnings: $32.81 (up $2.52 year-over-year, or 8.3%).
Vehicle manufacturing: $40.59/hour, up from $37.80.
Parts manufacturing: $29.97/hour, up from $28.47.
These increases reflect tight labor markets, 2024’s union contract wins, and growing demand for skilled workers in high-tech vehicle production. However, rising wages may also pressure employers to automate or reduce headcount to manage costs.
Shorter Workweeks Suggest Leaner Operations
Seasonally adjusted data shows average weekly hours fell to 42.1, down 0.8 hours from both last April and last month. That drop points to:
Slower production cycles
Efficiency gains from automation
Cost-cutting in response to economic uncertainty
What’s Driving the Shrinkage?
Several forces are reshaping the workforce:
Tariffs and Trade Shocks: New 25% tariffs on imported auto parts and vehicles (effective April 2) led to furloughs and rising costs. Stellantis furloughed 900 workers; GM projected a $4–5 billion cost hit.
Market Volatility: Early April saw a strong vehicle sales surge, but late-month slowdowns and parts shortages reversed momentum.
Automation Advances: Robotics and AI reduce labor needs—especially in parts manufacturing—contributing to shorter workweeks and job reductions.
Labor Costs: Wages are rising fast—great for workers, but a challenge for manufacturers seeking to control operating costs.
Geographic Shifts: Southern states are gaining jobs thanks to federal EV incentives and lower operational costs, while traditional hubs struggle with higher expenses and legacy systems.
Real-World Impact: Ford Faces $1.5 Billion Hit from Tariffs
The financial toll of tariffs is already hitting major automakers. Ford Motor Company projects a $1.5 billion net profit loss this year due to new tariffs, prompting the company to suspend its annual earnings guidance.
Ford is rerouting vehicles from Mexico to Canada and then into the U.S. to reduce tariff exposure, and analysts estimate tariffs have added nearly $4,911 to the cost of each vehicle assembled in the U.S. Industrywide, automakers like Ford, GM, and Stellantis could face a combined $41.7 billion in additional costs in 2025 due to tariffs.
For manufacturers, these costs often translate into hiring slowdowns, shorter shifts, or deferred expansion—making tariffs a key force behind this year’s job losses.
Trade Outlook: China Tariff Truce May Slow Job Losses—For Now
On May 12, 2025, the U.S. and China reached a major trade agreement that could bring short-term relief to auto parts manufacturers. Both countries agreed to pause the 34% reciprocal tariffs announced in April and instead impose a 10% baseline tariff for 90 days, starting May 14. China will also remove retaliatory tariffs and non-tariff measures introduced earlier this year.
While this agreement doesn’t remove older tariffs (like those under Section 301 and 232), it eases the immediate pressure that had forced companies like Stellantis and GM to furlough workers. For now, the reduction in tariff rates could stabilize costs, support supply chain continuity, and slow the pace of job losses in parts manufacturing—though a full recovery depends on whether a permanent deal is reached.
What’s Next?
We’ll be watching closely in June to see if job losses continue—or ease as trade deals, EV demand, and tech investments evolve.
For workers, upskilling in EV and automation technologies could be the key to staying ahead. For employers, balancing cost, talent, and production is only getting tougher.
Have questions or hiring needs in the automotive space? Get in touch with Timpl’s team
Stay tuned for next month’s update, where we break down new BLS data and what it means for the workforce.