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American Companies Dominate 2018 Kogod Made in America Auto Index as Tariff Concerns Loom

Article ID: 697825

Released: 24-Jul-2018 12:05 PM EDT

Source Newsroom: American University

Newswise — Washington, D.C. (July 24, 2018) -- As tariffs and trade wars engulf business headlines, American auto companies continue to manufacture the majority of their cars in the USA, according to the 2018 Kogod Made in America Auto Index.

General Motors snatched the top two slots on this year’s index with the Chevrolet Corvette and Volt models, respectively.

The Kogod Made in America Auto Index was created in 2013 by Kogod School of Business Associate Professor Frank DuBois. The index ranks more than 500 vehicles and draws on data provided by the American Automotive Labeling Act and on-site dealership visits to calculate the estimated domestic content of the most popular vehicles on America’s roads.

DuBois’ index also draws on additional criteria to develop its rankings to provide a clearer picture of the economic impact of the vehicles in the index, including: profit margin, labor content, major component sourcing and major location of research and development activities.

Ford Motor Company had a strong showing in the top-10, occupying five slots with two models of the Ford F-150 (No. 3 and 4), the Lincoln Continental (No. 5), the Ford Taurus (No. 9) and the Lincoln MKC (No. 10). Three of Fiat Chrysler’s Jeep Wrangler models occupy spots six, seven and eight. Honda’s Ridgeline (No. 6), Odyssey (No. 6) and Pilot (No. 10) were also in the top-10.

For consumers who value purchasing an American-made car, the Kogod Made in America Auto Index provides the most comprehensive listing of cars available.

“For a consumer interested in buying American or perhaps just curious about the 'DNA' of their car, my index lists almost every car available for sale in the US market,” DuBois said. “Most other indexes stop at the top 10 most American cars. You don’t know about the bottom ten. Or the middle fifty. My index covers over 500 cars.”

While some vehicles come close to being all-American, DuBois acknowledges that globalization has all but eliminated the idea of a truly American-made car.

“It’s likely that no vehicle has been truly 100 percent American since the Model T,” DuBois added. “And you could argue that some of those parts were mined or manufactured out of the country. This index gives the best current estimation of domestic content for vehicles sold in the US.

Looming over this year’s index are the threats of tariffs and trade wars that will have a big impact on the auto industry if enacted. DuBois predicts future price increases for automobiles as a result.

“When you start changing the rules of the game, you start changing what that means for various parts of supply chains. If you put a twenty percent tariff on parts from other countries, that will increase the costs of vehicle production, and those increases will be passed along to consumers.”

“The price of vehicles will rise and domestic consumption of vehicles will fall. In addition, retaliation by trading partners will make it that much harder for US vehicle exporters and parts producers to win orders in foreign markets.”

The 2018 Kogod Made in America Auto Index is available here.

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