Americans don’t Purchase American Cars Anymore

Being patriotic no longer means having to spend one’s money on American made products.  The truth be known, with so much outsourcing going on in today’s business world, it is getting more difficult to find any product that is one hundred percent USA built with pride.  The automotive world is very much a reflection of this reality.

You can break the automobile manufacturers into four groups:  USA brands, European brands, Japanese brands, and Korean brands.  Each has its own targeted audience and marketing group to set a sales pitch towards.  Unfortunately, as we dissect these groups it will become apparent why there is less and less argument to buy USA brands.

Ford, General Motors and Chrysler make up what should be considered the USA brands.  Before the economic crisis rocked the world economy, each was unique in their “American” roots.   Just the breakdown of each group questioned the origins of their vehicles.

Ford was made up of Ford, Mercury, Lincoln, Rover, Jaguar and Volvo.  Half of their vehicles were foreign name plates and the remaining three (Ford, Mercury and Lincoln) had models that were interchangeable with each other except for a few unique models for Ford and Lincoln.  The Mustang was one of the few originals although even this historical car had an era in its times gone by when it was also a Mercury Capri.   How many Mercury models of today can you count on your hand that are exclusively designed and sold under the Mercury nameplate?  Get the point?

General Motors, or GM as they are generally referred to, was a dysfunctional family since the oil embargo of the early 1970s.  With the exception of a few Cadillac models and the Chevrolet Corvette, there aren’t many exceptions in the nameplate models.  GM had, at its peak, Chevrolet, Pontiac, Buick, Cadillac, Saturn, Opel, Hummer, and Saab.  Only Opel wasn’t sold in the USA in its original form.  There was, however, during the end of the Saturn run, rebadged European Opel models like the Astra sold in the USA.  That was probably one of the better models sold by Saturn, which reflects the standards of their USA built products and explains why they are following Oldsmobile and Pontiac to the graveyard.  GM has been able to establish themselves as the darlings of the car rental industry which has a double edge sword danger to it.  Many more people get an opportunity to drive their products while traveling, but those same people really don’t want to be known as owning a rental car of their own.  Throw in quality problems and yawn inspiration to their models and you have the ingredients for bankruptcy.  Didn’t anyone see that coming in GM HQ?

Finally, we have the bastard child no one wants but everyone seems to die for.  Chrysler attempted to be the big player in the 1980s when its K cars brought it back from the verge of vanishing.  They went on to buy out AMC and their profitable Jeep name brand while taking on the extra burden to AMC’s commitment to selling Renault products in the USA.  Remember the Eagle brand of cars?  While Lee Iacocca stood in front of us telling us the Eagle must fly, the real future lied in the cars quickly become investment products for automobile collectors hoping to get their money back with time for the limited time production of the name plate.  Mercedes took on Chrysler in the big merger of the automobile world.  This was done more so to sell cheaper Chrysler products to the European market and take advantage of the Jeep heritage than actually planning on using Chrysler as a force in taking over the automobile market.  In the end, the losses of Chrysler were too much and they were dropped.  Unfortunately, no one took notice of the improvement of product reliability under Mercedes and they were left for dead until Fiat threw them a lifeline.  But, like Mercedes, Fiat has corporate interest in mind over really reviving Chrysler.  Fiat has wanted to get a foot back into the USA market and found the perfect solution in buying Chrysler and its dealerships to start selling Fiats, Lancias and Alfa Romeos in the USA.  Oh, and they love the Jeep heritage as well.

European brands include Audi, BMW, and Mercedes as the big three.  Each is related to personal luxury and reliable transportation.  Audi has Volkswagen included in its package to reach out to the middle class while all three provide a product that provides no shame to its owners.  One will brag endlessly about their European brand automobile rather than explain the rebates and zero finance offers that USA brand buyers use.

Japanese brands have been the thorn in the USA carmakers side since the early 1970s.  When gas was suddenly no longer cheap, the little four bangers from the rising sun land became a good second car choice for Mr. and Mrs. American Household.  American carmakers didn’t have anything small and economical to compete with them.  This is something that still hasn’t changed much in almost forty years of competing.  However, the Japanese brands of Toyota, Nissan and Honda all decided to move into the American automobile makers turf in producing larger, more reliable cars with better packaging and a turnover rate of four years on their models to prevent a name brand from going stale in an ever more inconsistent market.   They even dared to venture into the pickup and SUV turn once dominated by the big three from Detroit.  Not only did they dare, they became quite successful and stole away sales year after year while the Detroit three stood by and asked for import tariffs and government handouts to compete with them rather than invest time and money into a better product.  Ford, GM and Chrysler seemed to have forgotten the basic rules of an open market in a capitalism economic system.

With a declining market, the American brands faced a new challenge for Korea.  Hyundai, Kia and Daewoo presented a threat to the low end of the market with automobiles for the college student class as well as the market of second car once owned by Japanese brands that, with time, grew out of the zone with larger cars and higher prices.  For the price of a used Chevy, a person could buy a new Hyundai with warranty.  As Korea progressed into the USA market, so did the quality of their product.  In the meantime, the USA brands still failed to make any argument for the buyers to purchase their products other than the patriotic call of “buy American.”  When money became scarce, the consumer couldn’t afford to buy patriotic rhetoric and have placed their funds on products that will give them the most for the buck.

The result?  What company is owned by the US Government and what companies are still flourishing under their own abilities?  It is time for what is left of the big three to take a step back and realize the American automobile world has changed.  Big gas guzzlers and unreliable products with “Built with Pride in the USA” stickers on them will no longer be moving from the showroom floors.  Consumers want products that give them reliability in a package that is attractive and offers enough personality to permit them to display their purchase with pride and not making excuses.  Listen to the market and start planning the next models with what the consumers want, not what the country wanted fifty years ago.  Until they do this, they will have to understand why Americans no longer purchase American cars.

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