The Volkswagen ID.4 electric vehicle is more American than the Jeep Gladiator SUV, and it’s a lot more American than the Ram 1500 Classic pickup, according to the 2024 Cars.com American-Made Index.
Volkswagen proudly touts how American it is, Aaron Pardue, general manager at Joseph Volkswagen of Cincinnati, tells WardsAuto.
“The ID.4 is made in Chattanooga (TN),” he says. “In fact, 40% our lineup is made domestically. We are absolutely using that to our advantage in the short term.”
As tariffs on imported vehicles and parts are imposed automakers and their dealers, are taking varied approaches to using their American-ness as a marketing tool.
Americans may not have given a lot of thought to how much of their vehicle’s content was sourced from plants outside the U.S., but they have reason to pay more attention to that information now that imported autos and auto parts face stiff tariffs.
And as Patrick Masterson, lead researcher for the Cars.com American-Made Index points out: “No car is 100% American-made. The highest U.S. parts content available today is around 75% for the Tesla Model Y.”
Tariff Reprieve Impact Unknown
On April 2, a 25% tariff began being levied on imported vehicles. On May 3, a similar tariff is scheduled to begin being levied on imported parts.
But on April 29, President Trump signed an executive order stipulating that automakers that assemble their vehicles in the U.S. can apply to offset up to 3.75% of their tariff costs related to auto imports for one year, retroactive to April 3. The available offset rate will drop to 2.5% for the next 12-month period and then be removed.
The 3.75% rate was calculated based on the application of the soon-to-be implemented 25% auto parts tariff to vehicles made with 85% U.S. or United States-Mexico-Canada Agreement content, per the amended order. In such an example, the automaker would not pay any tariffs on auto part imports for the next year.
The actual impact on car prices of this small reprieve is unknown, however, Masterson says.
“The new policy gives automakers a bit of a cushion,” he says, “but there’s no guarantee that the relief will trickle down to consumers.”
What Makes a Vehicle American?
Cars.com has since 2020 judged vehicles on assembly location, parts content, engine origin, transmission origin and U.S. manufacturing workforce to determine a vehicle's American-ness.
It started the list “because the badge on the hood doesn’t always match what’s underneath,” Allison Phelps, senior communications manager at Cars Commerce, tells WardsAuto.In the past, consumers may have wanted to buy cars with high American content to support the local, regional or national economy, analysts say.
Now, with tariffs imposed or looming, the American content also speaks to the potential cost of a vehicle, however.
While Cincinnati’s Joseph Volkswagen doesn’t tout its American-made status on its website, it does loudly trumpet that it has tariff-free inventory.
“Buy Now & Save! Take advantage of existing deals before car prices increase,” the website says.
The level of concern among consumers about where their vehicle is made varies somewhat by brand, Rebecca Lindland, managing director-automotive for Allison Worldwide, a global marketing and communications consultancy, tells WardsAuto.
“I think the people who buy products from GM, Ford, Stellantis, Jeep, Dodge, Ram, they want them built in the U.S.”
In the past, they may not have given much thought to where the components in those vehicles were made, she says, but they do now.
“It is something we have brought to the attention of people; that where their car is made means jobs in America,” Lindland says.
Information about where a vehicle’s content is sourced has always been readily available on the vehicle’s Monroney sticker, she adds.
Mum on Tariffs
Honda models nab four of the top ten spots in the 2024 American-Made Index.
The automaker provides a poster for dealers to showcase the Honda models’ ranking on the Cars.com American-Made Index, and the Honda in America website provides dealers with information on the automaker’s U.S. presence, American Honda spokesman Alvin Tsang says.
The general manager of a Southern California Honda dealer tells WardsAuto he hasn’t had customers ask about Honda vehicles’ American-made content.
If they do, “I can refer them to the poster,” he says.
“Different markets are definitely different,” the general manager says. “I had anticipated there would be a lot more talk about it. The canned answer (now) is everything that is here right now does not have any tariffs.”