The auto industry remains a significant part of the American economy. It includes 1.55 million people employed directly by automakers and suppliers. Plus, there are millions more in related fields like at repair shops and parts stores. Many buyers want to support these companies by buying a domestic vehicle. According to research by American University’s Kogod School of Business, if buying American is someone’s biggest priority, then General Motors' models are among the best choices.
The Chevrolet Traverse, Buick Enclave (above), and GMC Acadia tie for the lead this year’s Made in America Auto Index because the crossover trio are 80 percent American. Ford takes second place thanks to the F-150’s 70 percent domestic components. However, GM rounds out the top three with the Chevy Corvette at 66 percent. Notably, the General also holds an eight-way tie for fourth place, including more models from Chevy, GMC, and Buick, plus the Cadillac Escalade. You can check out the entire list for yourself, here.
An American law requires automakers to tell buyers the percentage of a vehicle's content from the U.S and Canada, but the Kogod School of Business believes the methodology to calculate the figures creates inaccurate numbers. Therefore, it does this separate study. For example, GM officially lists the Traverse, Enclave, and Acadia at being 90 percent domestic, whereas this study puts them at 80 percent.
To generate the study’s percentages, the researchers take into account economic value in addition to the ratio of domestic parts. For example, the results consider where automakers have their headquarters, factories, and R&D offices. The theory goes that locating more of these activities in the U.S means a larger part off the profits stay in the country.
Source: General Motors, Kogod School of Business
Gallery: 2016 Buick Enclave Tuscan Edition launched with cosmetic tweaks and more equipment
GM Dominates the Top 10 in Study of Most American-Made Vehicles
DETROIT — For the fourth consecutive year, Chevrolet, Buick, GMC and Cadillac vehicles are the leaders of the Made in America Automotive Index produced by American University’s Kogod School of Business.
The Buick Enclave, Chevrolet Traverse and GMC Acadia together tied for No. 1, while 17 other General Motors vehicles ranked in the Top 10.
The index is authored by Frank DuBois, a global supply chain management expert and professor at American University in Washington, D.C. More comprehensive than other studies of its kind, the Kogod index ranks models based on seven weighted data points including several factors unaddressed by the American Automotive Labeling Act (AALA), the basis for “made in America” automotive studies.
Kogod's method improves on AALA data by incorporating a more comprehensive research methodology, providing consumers with a more accurate view of their vehicle's composition. The Kogod study considers:
1. Profit Margin: location of the automaker's global headquarters
2. Labor: where the vehicle is assembled
3. Research and Development: location of R&D activities
4. Inventory, Capital, and Other Expenses: location of assembly
5. Engine: location of production
6. Transmission: location of production
7. Body, Chassis and Electrical Components
According to the AALA, if 75 percent or more of a car’s parts by value come from the U.S. or Canada, it’s considered a domestic product.
Click here to view the complete 2016 Kogod Made in America Auto Index.
General Motors Co. (NYSE:GM, TSX: GMM) and its partners produce vehicles in 30 countries, and the company has leadership positions in the world's largest and fastest-growing automotive markets. GM, its subsidiaries and joint venture entities sell vehicles under the Chevrolet, Cadillac, Baojun, Buick, GMC, Holden, Jiefang, Opel, Vauxhall and Wuling brands. More information on the company and its subsidiaries, including OnStar, a global leader in vehicle safety, security and information services, can be found at http://www.gm.com.
The Kogod School of Business at American University in Washington, D.C. was founded in 1955. Committed to the belief that profit and purpose are not at odds, Kogod believes purpose-driven individuals create sustainable organizations which shape a thriving global economy. Kogod provides graduates with a rigorous framework of business education and research to develop their critical thinking and problem solving skills, prepares them to work and lead in organizations across the private and public sectors spanning the globe, and to understand the broad and enduring impact organizations have on individuals and society. Kogod is accredited by The Association to Advance Collegiate Schools of Business (AACSB). To learn more about the Kogod School of Business, visit http://www.american.edu/kogod/.