Chevrolet, Ford Take the Lead in 2014 Kogod Made in America Auto Index
Index Provides More Accurate Evaluation of Vehicles’ True Country of Origin
Source Newsroom: American University
WASHINGTON, D.C. (April 3, 2014) – The Chevrolet Corvette and Ford F-Series pickup are the most American-made car models, according to the 2014 Kogod Made in America Automotive Index.
Developed by Associate Professor Frank DuBois, an expert in global supply chain management, the index ranks 318 car models based on seven weighted data points. These criteria include several factors unaddressed by the American Automotive Labeling Act (AALA). The criteria include:
• Profit Margin: Location of the automaker’s global headquarters
• Labor: Location of assembly
• Research & Development: Location of R&D activities
• Transmission: Location of production
• Inventory, Capital and Other Expenses: Location of assembly
• Engine: Location of production
• The AALA “Domestic Content” Score
DuBois used publicly available data to develop the index, including data from the AALA, automakers’ annual reports, and Form 10-K filings to the U.S. Securities and Exchange Commission. Automakers received up to 100 percentage points based on the scores each received in the seven categories noted above.
The top six vehicles (several received the same score) in the 2014 Kogod Made in America Auto Index, based on a 100 point scale, are the Ford F-Series Pickup (Score: 87.5); the Chevrolet Corvette (87.5); the Buick Enclave (86); the Chevrolet Traverse (86); the GMC Acadia (86); and the GMC Acadia Denali (86).
Professor DuBois believes the Kogod Index represents the most accurate “made in America” index available because it acknowledges that every vehicle is likely to include non-American content, given that a global supply chain is the operating reality of the entire automotive industry.
According to DuBois, the AALA is meant to help consumers “buy American,” but the data it provides is limited in several ways. Since the 1994 passage of the AALA, automakers have been required to affix a label documenting the percentage of “American” content in each vehicle sold in the U.S. While this data is useful, it has some limitations. Most notably:
1. Canadian and U.S. content are not disaggregated;
2. Automakers can “round up” from 70 to 100 percent to calculate domestic content;
3. Cars with very little U.S. content may be allowed to use labels from vehicles with higher U.S. content if they are part of the same carline.
“This index provides the public with a more accurate reflection of the true country of origin of a car and the impact of its purchase on the U.S. economy,” said DuBois. “And hopefully, it holds vehicle manufacturers accountable for the claims they make in marketing to U.S. consumers.”
To view the complete 2014 Kogod Made in America Auto Index, visit kogod.american.edu/autoindex.
About American University
American University is a leader in global education, enrolling a diverse student body from throughout the United States and nearly 140 countries. Located in Washington, D.C., the university provides opportunities for academic excellence, public service, and internships in the nation’s capital and around the world.
About Kogod School of Business
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 kogod.american.edu.
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