Buy American- What Does That Mean?

Industry Week Reports that “Ford Plans Move for Compact Car Production Out of US.” What exactly does “Buy American” mean these days?

032609_buy_american.jpg

In 2009 , While two of the three  bankrupt thinking Detroit firms were using the government to bully their way through Bankruptcy, running roughshod on their suppliers and creditors, I wrote a piece about “The New Domestics.”

Here are a few points that I made in that article:

  • More than 70 percent of the value added in a new car is provided by the suppliers, not the assemblers;
  • More than 300 companies have created jobs in Ohio as a result of the state’s “New Domestic” auto industry;
  • Honda has plants or major operations in Alabama, California, Connecticut, Colorado, Georgia, Indiana, Iowa, Michigan, New Jersey, North Carolina, Ohio, South Carolina, Tennessee and Texas.
  • Mercedes has a plant in Alabama too.
  • And BMW has a plant in South Carolina.
  • Volkswagen has broken ground for an assembly facility in Chattanooga, Tennessee. (It’s been making cars since 2011, employs 2000 people)

So what is an American Car?

  • One made by my friends and neighbors;
  • Made from materials and parts purchased locally;
  • One that the first digit of the VIN is a “1”;
  • One that has more than 50% “domestic content;”

Want to know more about American Cars in 2015?

The MOST AMERICAN CARS

What is the US’s leading auto exported abroad?

Surprise Answer

Industry Week Article

Thanks to Draplin Design for the neat graphic.

Camry Photo

Postscript- Not to diminish the role of Canadian Manufacturers- nor their vehicle assembly plants.  PMPA members in Canada produce high volumes of high technology systems parts for the automotive markets- fuel injectors, anti-lock brake parts,  fluid power system components and much, much more. But the irony of the whole Ford “Wrap ourselves in the flag while we really export your jobs” marketing  is really the “driver” behind this post.

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2 Responses to Buy American- What Does That Mean?

  1. Greg Knight says:

    Great article, Miles. As a responsible consumer, meaning getting value for my dollars spent, I have always given an edge to American-made products when doing the evaluation. Many years ago I discovered that the domestic content of many ‘foreign’ cars were higher than that of ‘American’ cars. Ditto for other products. And our industry makes parts for these, no matter what country the parent company is from. These are indeed American jobs that we are talking about.

    Thanks for reminding us it’s not just the ‘company’, but all the processes that are of American origin in many items (not just cars) for making parts, assembling items, the distribution networks, service & parts after the sale…these all contribute to our GNP.

    • You’re welcome Greg. Keeping North American Manufacturing Competitive just might involve helping our friends and neighbors understand just who is truly a North American Manufacturer.
      Appreciate the thoughtful comment.
      Miles

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