Vehicles and Tires Made in the U.S. Still Matter -- For Now

Bob Ulrich
Posted on March 8, 2018

Would you consider Toyota Motor Sales U.S.A. Inc. a domestic or foreign car company? The parent company is based in Japan. But Toyota has been manufacturing vehicles in the U.S. since 1972.

Also, along with Ford Motor Co. and General Motors Corp., it is part of the Big 3 car producers in the U.S., having supplanted Fiat Chrysler Automobiles US LLC (FCA) -- also owned by a foreign company -- last year.

Our government cares, but not in the way you might think. It only is concerned with how a vehicle is marketed. If it is marketed as "Made in the USA," it must meet certain guidelines.

To be able to say a vehicle is Made in the USA, it must be “all or virtually all” made in the U.S., according to the U.S. Federal Trade Commission (FTC).

What does that mean? The FTC tries to clear that up: “'All or virtually all' means that all significant parts and processing that go into the product must be of U.S. origin. That is, the product should contain no — or negligible — foreign content."

Unfortunately, the FTC doesn't define "negligible."

The National Highway Traffic Safety Administration's "Automobile Parts Content Labeling" regulation requires passenger vehicles manufactured after Oct. 1, 1994, "to have labels specifying their percentage value of U.S./Canadian parts content, the country of assembly, and countries of origin of the engine and transmission." Its purpose is "to help consumers in the selection of new vehicles by providing information about the country of origin of vehicles and their parts."

Back to Toyota. In the April 2018 issue of Consumer Reports (CR), Toyota fared well in the "Best & Worst Cars, SUVs and Trucks" comparison testing. Four of its vehicles were among CR's Top 10 picks (Corolla, Camry, Sienna and Highlander), and it ruled the mid-size and smaller categories, including the Compact Electric and Hybrid category (the Prius Three was No. 1, Prius Prime Premium was No. 3).

As an aside, I found it interesting that one of the best-selling vehicles in the U.S. in 2017, the Toyota Rav 4, finished fourth in the Compact SUV category. CR still recommended it, but the Subaru Forester and two Honda CR-V models were ranked higher.

And only two of the 23 vehicle categories was led by one of the original Big 3 companies: Full-sized Pickups (Ford F-150 XLT) and Large Cars (Chevrolet Impala Premier).

Ten original equipment tire brands can be found on Toyota's in the U.S. Here they are, with their market share, courtesy of the 2018 Modern Tire Dealer Facts Issue:

Bridgestone  27%     Michelin  24%

Goodyear  12%        Dunlop  8%

Continental  7%        BFGoodrich  6%

Toyo  5%                  Yokohama  5%

Firestone  3%           General  3%

The market share of the 10 brands is based on U.S.-content, too: Either the vehicle or the tires had to be produced in the U.S.

I have had tire dealers tell me that to some of their customers, Made in the U.S. or Made in America still matters. But it remains hard to define, and is slowly becoming irrelevant. I've seen tires marketed as Made in America without the retailer actually knowing; if the manufacturer has a tire plant in the U.S., their thinking goes, that counts.

Will anyone younger than a baby boomer care if their tires or vehicles were Made in the U.S. 10 years from now? I don't think so.

Related Topics: 2018 Facts Issue, B.O.B., Consumer Reports, FTC, NHTSA, OE tires, tire market share

Bob Ulrich Editor
Comments ( 1 )
  • TireTime

     | about 7 months ago

    I have heard that "made in USA matters" argument as well in select parts of the country (Rust Belt primarily). But then again you have many legacy tire mfrs that play up the 'American Company' Card while sourcing most of their tires from overseas, Mexico, etc. even as an OE fitment. Ask the "made in the USA" tire buyer what brand of TV or where their cell phone in the pocket was made. It's outdated thinking.

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