Low Alabama Unemployment Slows Mazda Production

Mazda is struggling to produce enough SUVs, particularly the CX-50, which is made in Huntsville, Alabama. The unemployment rate is so low in Alabama that the automaker is pumping the brakes on the production of the Mazda CX-50.

The Japanese car company created the Mazda CX-50 specifically for the American market. Therefore, it only made sense to produce this vehicle in America, closer to its target audience. However, unemployment in Alabama has put the automaker in a little bit of a tricky situation. With not enough Alabamans to produce the SUV, Mazda is forced to slow production of the popular SUV.

Looking Ahead and Solutions

Currently, America’s market for cars, houses, stocks, and many other things is as volatile as ever. Companies, politicians, and investors are doing their best to reclaim stability and issue in a new era of financial stability. But that time has not come just yet. Mazda dealers might be taking a hit very soon.

The unemployment rate in Alabama is causing problems for Mazda’s production of the CX-50. In 2020 we saw America’s unemployment rate rise to a staggering 14%. Since then, things have gotten much better for Americans. As of right now, the average national unemployment rate is floating around 3.5%, and Alabama’s unemployment rate is even lower, sitting at 2.6%. The tight labor market is enough to disrupt Mazda’s operations in Huntsville.

Looking ahead, Mazda has to come up with solutions to its problem before it gets even worse. As reported on Automotive News, the staff in Huntsville, Alabama, are trying to train employees better to improve employee retention. After that, Mazda officials hope to add a second operations shift, giving opportunities to others who work on different timetables.

It’s Not Just Mazda: Other Automakers are Struggling To Produce

Mazda is not the only Japanese automaker to be struggling during this time. Subaru, who has a production site in Indiana, is also finding it hard to find enough people to produce their vehicles. There is a mixture of high competition and low availability that is affecting these automakers and hurting their production.

It is speculated that part of the reason Subaru is suffering is that there is a McDonald’s near their production factory that is offering higher wages. But it can’t be that one McDonald’s has that kind of effect, right?

For Mazda and Subaru alike, the problem might be a bigger one than expected. Mazda sales in America are down 17.8%. Production and supply are taking a massive hit. And other issues, such as higher borrowing rates, are pushing potential new car buyers away from the market.

So, if you’re headed to your Mazda dealer hoping to buy a new Mazda CX-50, you may need to pack your patience for the time being.