How American Does An American Car Have To Be?

When the Ford Explorer came out in 1990, it was a hot commodity and early on, dealers struggled to keep them on the lots. My father was an automotive reviewer at a local newspaper at the time and his boss was trying to track down an American SUV to replace his Isuzu Trooper. He wanted an Explorer and wouldn’t consider a Mazda Navajo that he could have that afternoon at the Mazda dealership down the street because “it wasn’t an American car.” Except it was.

The Navajo was a Ford Explorer built in Kentucky but sold by Mazda, which was partly owned by Ford at the time, too. That insistence to buy American may have waned since the 1990s, but defining what an American car actually is has become even harder.

While foreign automakers have been assembling cars in this country for decades upon decades, it's the amount of local content that begins to blur the distinctions domestics vs. imports. Can you really call our Volkswagen Passat an import if it isn't even sold in Germany?

A recent study by American University’s Kogod School of Business reveals that a car has to be pretty American to be considered American. Unlike an annual index conducted by Cars.com for the past few years, they say a vehicle with an American nameplate — manufactured by a company headquartered in this country — has a big advantage over something with a European or Asian badge that happens to be made here.

That’s largely how the Chevrolet Traverse, GMC Acadia and Buick Enclave — all made in the same Lansing, Mich. plant and equipped with domestically made engines and — topped the Kogod list. By contrast, the Cars.com list in 2012 indicated that a Toyota Camry actually contains the most domestic parts out of any new car currently sold in this county, even the flag-waving Ford F-series.

Here's how the Kogod study awards points to cars:

  • Profit Margin, 6%: 6 if US company; 0 if foreign
  • Labor, 6%: 6 if assembled in US; 0 if foreign.
  • Research & Development, 6%: 6 if US company; 3 if foreign and assembled in US; 1 if foreign and imported
  • Inventory, Capital, & Other Expenses, 11%: 11 if assembled in US; 0 if assembled outside of US
  • Engine, 14%: 14 if US produced; 0 if not
  • Transmission: 7 if US produced; 0 if not
  • Body, Interior, Chassis, Electrical & Other, 50%: 2013 AALA% divided by 2.

And now here's how Cars.com does it:

"Cars.com's American-Made Index rates vehicles built and bought in the U.S. Factors include sales, where the car's parts come from and whether the car is assembled in the U.S. We disqualify models with a domestic parts content rating below 75 percent, models built exclusively outside the U.S. or models soon to be discontinued without a U.S.-built successor."

So there’s plenty of room for discrepancy, which is why Camry, top ranked by Cars.com, ranks number 12 by Kogod. The GM crossovers are sixth, ninth and tenth on Cars.com’s list, too. But think about this: Kogod thinks a Dodge Avenger is as American as a Ford F-series. Even though the Dodge is made in Michigan and the Chrysler Group headquartered there, too, Chrysler is 61.8% owned by Fiat.

Another question comes when Cars.com specifically eliminates vehicles from its index that may have a significant amount of American-made content, but are assembled in different countries. The Toyota Matrix has a 95% domestically sourced content, but it’s all put together in Canada. The Chevy Equinox/GMC Terrain crossovers rank fifth in the Kogod study, the same as a Ford Mustang or Chevy Corvette. But the Mustang and Corvette are also assembled in America, and the Equinox and Terrain are made in Canada.

It all makes for interesting reading and analysis and potential arguments at the Elks Lodge. That’s what these indexes generally mean to me and I don’t mind because I’m fascinated by what people think an American car really is. To me, in this globalized world it’s the badge above all else. If you want to support jobs, you buy something that was built where you live.

Even though they produce different results, the Kogod and Cars.com indexes illustrate the two schools of thought when considering what an American car is today. But above all else, how important is this when you’re considering issues like power, handling, styling and features in a new car? To me, those rank much higher.

Does "American-ness" really matter to buyers anymore? Sound off in the comments.

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