Michigan faces a “critical time” in the auto industry that underpins the state’s economy and job base, a Michigan industry group said, urging businesses and policymakers to prioritize innovation. Glenn Stevens, executive director of the statewide advocacy group MichAuto, framed the moment as an “inflection point” and said Michigan needs to make changes to protect the industry’s role in the state.
Stevens told Bridge Michigan that the industry is at “a critical time in the industry’s history,” and that “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.” He said the message is part of what MichAuto described as a “call to action.”
The concerns come as Michigan prepares for its largest annual automotive celebration: the Detroit Auto Show returning to Detroit’s Huntington Place from January 17-25. MichAuto said the auto industry accounts for about 20% of Michigan jobs and has a payroll of $83 billion.
MichAuto’s report warns that Michigan cannot rely on its automotive legacy to preserve economic benefits such as employment and support for the state’s gross domestic product. Stevens said that because of automation and the digital economy, Michigan needs to elevate innovation as a business goal that creates jobs and economic growth, and he urged a focus on research and development.
“We have to double down on the research and development part of the industry,” Stevens said, adding that Michigan is the top state for privately funded auto R&D research. He also said innovation centers—citing Michigan Central as an example that is funded by Ford and the state—should take on a bigger role in Michigan’s economy, including by supporting other industries such as the life sciences.
MichAuto said the state’s need for innovation is tied to shifting industry conditions, including federal policy changes and market forces that have altered automakers’ electric vehicle plans. The story said the auto industry was affected by waves of tariff changes and new fuel economy standards, and that automakers curtailed their electric vehicle strategy.
Among the developments cited, the report described Ford’s December announcement that it would take a $19 billion hit to shift EV capacity to gas-powered vehicles, while adding new energy storage systems to its EV battery lineup. The report also said southern U.S. states are building a “battery belt” by actively recruiting automakers and suppliers, including those from Michigan, while saying the Chinese auto industry is advancing “at an astounding rate as it attempts to dominate the race for electrification.”
For 2026, Stevens said MichAuto would launch a roadmap focused on policy, economic development, and talent attraction. The group also advocated several areas of state action, including prioritizing workforce development such as Going PRO, after the Legislature reduced funding; increasing the number of bachelor’s degrees awarded; and creating a pipeline to replace aging workers.
MichAuto also urged Michigan to improve its business climate through tax and regulatory changes that it said would make the state more competitive. The group called for long-term, sustainable economic development incentives, noting that the approach has been controversial after lawmakers in 2025 defunded the $2 billion Strategic Outreach and Attraction Reserve (SOAR) Fund. It further said Michigan should add support for the industry transition so companies and workers can adapt to new technologies, manufacturing processes, and skills to keep auto jobs in the state.
Stevens said the latest “State of Automobility” report reflects a shift from MichAuto’s typical reporting cycle, which usually releases on a roughly 18-month schedule, and said the report includes data updates. The warnings also come alongside other reports raising concerns about Michigan’s broader economic trajectory, including a call from the Detroit Regional Chamber for Michigan to sharpen its education system.