They have put a cordon around the area, evacuated nearby buildings and asked people to stay away.
Police were also interested in "who may have had access to the auto or who may have gone to and from it".
Greater Manchester Police said the man was arrested on Friday night in Rusholme on suspicion of offences contrary to the terrorism act.
The man was arrested in the inner-city Manchester neighborhood of Rusholme.
A number of addresses are being evacuated in Manchester after police found a auto which may be "significant" to the inquiry into last week's terror attack at the Manchester Arena.
Eleven remain in custody.
Images include a video of Abedi shopping and others of him lugging a large blue suitcase around the streets of Manchester.
Bomber Salman Abedi's father and brother are also in detention in Libya, where authorities say the two brothers were both part of the ISIL which claimed responsibility for the attack.
Officers are now at the location and are assessing the auto as an evacuation is carried out, the police statement said.
A statement from Greater Manchester Police this morning said: 'As it stands 17 people have been arrested in connection with the investigation, of which six people have since been released without charge.
"My thoughts are with the families of the victims".
Britain's Prince William has also been visiting the city this afternoon, he made a private visit to Manchester Children's Hospital to meet survivors.
Ariana Grande, whose concert was the target of the attack, will be joined by performers including Justin Bieber and Miley Cyrus for a Manchester benefit show at Old Trafford cricket ground on Sunday.