Michigan Auto Industry at a Pivotal Moment, According to New Report
Michigan is at a pivotal moment, facing significant challenges to its $348 billion stake in the global automotive industry. The urgency of this situation has been emphasized by Glenn Stevens, the executive director of MichAuto, a statewide industry advocacy group. Recently, MichAuto released a report that Stevens describes as a “call to action.”
“This is a critical time in the industry’s history,” Stevens told Bridge Michigan. “We are at an inflection point like we’ve never seen before. We’ve got to be making changes and doing things differently to protect our signature industry and our economy as a whole.”
The stakes are high as Michigan prepares for its largest automotive event: the annual Detroit Auto Show, scheduled to take place at Huntington Place from January 17-25. The auto industry is a cornerstone of Michigan’s economy, accounting for approximately 20% of jobs and generating a payroll of $83 billion.
The MichAuto report warns that Michigan must enhance its innovation economy or risk being left behind. In 2026, the organization plans to unveil a roadmap focused on policy, economic development, and talent attraction to ensure the industry thrives in the state.
This call for action comes after a tumultuous year for the auto sector, marked by fluctuating tariffs, new fuel economy standards, and federal changes that have led automakers to reconsider their electric vehicle strategies. For instance, Ford Motor Co. announced in December that it would incur a $19 billion loss to shift its EV capacity back to gas-powered vehicles while also expanding its energy storage systems for EV batteries.
Moreover, southern U.S. states are actively constructing a “battery belt,” attracting automakers and suppliers, including those from Michigan. The report highlights that the Chinese auto industry is advancing rapidly, aiming to dominate the electrification race.
These developments indicate that Michigan cannot rely solely on its automotive legacy to sustain economic benefits such as employment and GDP growth. Stevens emphasizes the need for the state to prioritize innovation as a business objective to foster job creation and economic expansion.
“We have to double down on the research and development part of the industry,” he stated, noting that Michigan is the leading state for privately funded auto R&D. Innovation centers, such as Michigan Central, which is backed by Ford and the state, should play a more significant role in the economy as they evolve, supporting other sectors like life sciences.
To further bolster the industry, MichAuto advocates for several key initiatives:
- Prioritize workforce development, including Going PRO, a training program recently facing funding cuts. Goals include increasing the number of bachelor’s degrees awarded and creating a pipeline to replace aging workers.
- Enhance the state’s business climate through tax and regulatory reforms to improve competitiveness.
- Establish long-term, sustainable economic development incentives, a topic of controversy following the defunding of the $2 billion Strategic Outreach and Attraction Reserve (SOAR) Fund in 2025.
- Support the industry’s transition by helping companies and workers adapt to new technologies, manufacturing processes, and skills to retain auto jobs in Michigan.
The latest “State of Automobility” report from MichAuto marks a shift from the group’s usual reports, which are typically released every 18 months and focus on data updates.
These warnings come amid ongoing reports about Michigan’s declining prosperity, including alerts from the Detroit Regional Chamber that emphasize the need for improvements in the state’s education system.
In November, Business Leaders for Michigan released a 40-page roadmap titled “Michigan in a New Era,” outlining strategies for state success under the next governor, to be elected in fall 2026.
While the nation has experienced growth, Michigan has faced challenges:
- Ranked 50th in household income growth over the past 25 years.
- Flat growth in high-wage professional jobs over 20 years, compared to a 35% increase nationally.
- Fell from 16th to 44th in fourth-grade reading over 30 years.
- One of the highest rates of chronic school absenteeism in the nation.
The next administration must focus on “changing what’s within our control … to change our state’s trajectory,” according to the Business Leaders for Michigan report.
Additionally, University of Michigan economists warned in November that the state risks missing out on anticipated national job growth in 2026 due to an aging workforce and slow population growth.
Regarding the auto industry, the report noted that 2025’s tariffs had a slightly positive impact on the sector, despite initial fears of job losses. However, the effects of tariff policies remain uncertain, as they are fluid and difficult to quantify.
Currently, economists predict a 2.7% increase in light vehicle production, with new vehicle prices expected to rise by 6.6%, approximately $3,100 per vehicle. According to Anderson Economic Group, the average new vehicle price in November was $49,814.
Meanwhile, the Detroit Three’s share of U.S. light vehicle sales decreased from 36.1% in 2023 to 34.2% in 2024. However, U-M economists anticipate that this two-decade market share decline for General Motors, Ford, and Stellantis will reverse in 2026 as new federal policies take effect.
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This story was originally published by Bridge Michigan and distributed through a partnership with The Associated Press.
Copyright 2026 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Michigan is at a pivotal moment, facing significant challenges to its $348 billion stake in the global automotive industry. The urgency of this situation has been emphasized by Glenn Stevens, the executive director of MichAuto, a statewide industry advocacy group. Recently, MichAuto released a report that Stevens describes as a “call to action.”
“This is a critical time in the industry’s history,” Stevens told Bridge Michigan. “We are at an inflection point like we’ve never seen before. We’ve got to be making changes and doing things differently to protect our signature industry and our economy as a whole.”
The stakes are high as Michigan prepares for its largest automotive event: the annual Detroit Auto Show, scheduled to take place at Huntington Place from January 17-25. The auto industry is a cornerstone of Michigan’s economy, accounting for approximately 20% of jobs and generating a payroll of $83 billion.
The MichAuto report warns that Michigan must enhance its innovation economy or risk being left behind. In 2026, the organization plans to unveil a roadmap focused on policy, economic development, and talent attraction to ensure the industry thrives in the state.
This call for action comes after a tumultuous year for the auto sector, marked by fluctuating tariffs, new fuel economy standards, and federal changes that have led automakers to reconsider their electric vehicle strategies. For instance, Ford Motor Co. announced in December that it would incur a $19 billion loss to shift its EV capacity back to gas-powered vehicles while also expanding its energy storage systems for EV batteries.
Moreover, southern U.S. states are actively constructing a “battery belt,” attracting automakers and suppliers, including those from Michigan. The report highlights that the Chinese auto industry is advancing rapidly, aiming to dominate the electrification race.
These developments indicate that Michigan cannot rely solely on its automotive legacy to sustain economic benefits such as employment and GDP growth. Stevens emphasizes the need for the state to prioritize innovation as a business objective to foster job creation and economic expansion.
“We have to double down on the research and development part of the industry,” he stated, noting that Michigan is the leading state for privately funded auto R&D. Innovation centers, such as Michigan Central, which is backed by Ford and the state, should play a more significant role in the economy as they evolve, supporting other sectors like life sciences.
To further bolster the industry, MichAuto advocates for several key initiatives:
- Prioritize workforce development, including Going PRO, a training program recently facing funding cuts. Goals include increasing the number of bachelor’s degrees awarded and creating a pipeline to replace aging workers.
- Enhance the state’s business climate through tax and regulatory reforms to improve competitiveness.
- Establish long-term, sustainable economic development incentives, a topic of controversy following the defunding of the $2 billion Strategic Outreach and Attraction Reserve (SOAR) Fund in 2025.
- Support the industry’s transition by helping companies and workers adapt to new technologies, manufacturing processes, and skills to retain auto jobs in Michigan.
The latest “State of Automobility” report from MichAuto marks a shift from the group’s usual reports, which are typically released every 18 months and focus on data updates.
These warnings come amid ongoing reports about Michigan’s declining prosperity, including alerts from the Detroit Regional Chamber that emphasize the need for improvements in the state’s education system.
In November, Business Leaders for Michigan released a 40-page roadmap titled “Michigan in a New Era,” outlining strategies for state success under the next governor, to be elected in fall 2026.
While the nation has experienced growth, Michigan has faced challenges:
- Ranked 50th in household income growth over the past 25 years.
- Flat growth in high-wage professional jobs over 20 years, compared to a 35% increase nationally.
- Fell from 16th to 44th in fourth-grade reading over 30 years.
- One of the highest rates of chronic school absenteeism in the nation.
The next administration must focus on “changing what’s within our control … to change our state’s trajectory,” according to the Business Leaders for Michigan report.
Additionally, University of Michigan economists warned in November that the state risks missing out on anticipated national job growth in 2026 due to an aging workforce and slow population growth.
Regarding the auto industry, the report noted that 2025’s tariffs had a slightly positive impact on the sector, despite initial fears of job losses. However, the effects of tariff policies remain uncertain, as they are fluid and difficult to quantify.
Currently, economists predict a 2.7% increase in light vehicle production, with new vehicle prices expected to rise by 6.6%, approximately $3,100 per vehicle. According to Anderson Economic Group, the average new vehicle price in November was $49,814.
Meanwhile, the Detroit Three’s share of U.S. light vehicle sales decreased from 36.1% in 2023 to 34.2% in 2024. However, U-M economists anticipate that this two-decade market share decline for General Motors, Ford, and Stellantis will reverse in 2026 as new federal policies take effect.
___
This story was originally published by Bridge Michigan and distributed through a partnership with The Associated Press.
Copyright 2026 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
