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The U.S. Sun Belt is poised for a manufacturing boom as companies balance long-term planning with short-term needs. Over the past two decades, the Sun Belt states have outpaced other regions on population growth, and manufacturing facilities in the Mid-South have fielded an influx of interest and investment.
With trade uncertainties and workforce challenges among top concerns for manufacturing companies, the combination of growth in the workforce pool and the reduced import risk of domestic manufacturing makes the region an attractive investment opportunity.
This has already borne out in strong investment from global automotive companies. In just the past year, manufacturers have announced billions in investments across the Sun Belt states.
Nissan and SK On unveiled an investment of over half a billion dollars for the U.S. battery supply chain supporting Nissan's Canton, MS electric vehicle assembly plant. Toyota also announced nearly a billion dollars in investment in manufacturing facilities in Tennessee, Kentucky, West Virginia, Missouri, and Mississippi, following its 2023 announcements of investments in North Carolina battery plants.
Hyundai projects an over $5 billion investment in a groundbreaking Louisiana steel facility. Volvo is investing over a billion dollars in South Carolina operations.
Behind these investment announcements making a splash in the headlines lies a complex framework of contracts, supply ecosystems, and growing communities that support the manufacturing operations and reduce disruptions. This involves growth and diversity in Tier I, II, and III suppliers; logistics companies that move components and products across the country; workforce development and training; and local economies that flourish with stable employment.
Looking at Tennessee, the Tennessee Economic Development Commission has announced over $16 billion in manufacturing investment since 2017, and cites a 31 percent higher employment concentration than the national average.
Indicative of these trends, both construction and manufacturing added net jobs in 2024 and 2025. Median wages also grew in the same time period. Middle Tennessee specifically reflects a favorable business environment, strong labor market, and resulting solid economic growth. Companies that are looking for growth opportunities can build on the region's pool of ready candidates and supply chain infrastructure.
The region is even more ripe for growth in light of ongoing supply chain diversification and resiliency efforts across industries. As companies plan their investments and next generation of manufacturing operations, the shifting sands of international trade have placed the need for supply chain diversity and resiliency into sharp focus.
This has led to many companies seeking to reduce sole source reliance, move away from exclusively serving one customer, and ensure their contracts are able to account for global volatility. The Sun Belt states provide fertile ground for a diverse supply chain base to support manufacturing companies and these growing local economies.
From a legal perspective, the contractual framework underpinning this next generation of investment must also evolve to meet the modern supply chain and account for how to handle material changes in the economic and market conditions in the future.
This means providing clear mechanisms to revisit cost fluctuations, tariffs, and demand shifts while providing the stability and commitments necessary to support a strong workforce. Companies with long term contracts have found themselves revisiting these relationships this year, as economic realities clashed with decades-old provisions that failed to account for the geopolitical climate, inflation, labor force, and tariffs.
For supply chain professionals, this ranges from negotiating substantial contract amendments and concessions to hotly contested litigation as companies end or reframe their relationships. Contracts that are rigid and unchanging are more likely to face significant disputes and resulting supply chain disruptions down the line.
Looking ahead to 2026, both global and U.S.-based manufacturing companies will continue to navigate uncertainty by planning for longer term resiliency, diversification, and planting the seeds for weathering volatility through future investment in supply relationships.
The Sun Belt region can expect to see continued interest in investment to support domestic supply relationships and growth in the economic and community ecosystems that support these investments.
This article originally appeared on Manufacturing.net February 13, 2026.
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