The latest 2024 Kogod Made In America Auto Index has sparked significant interest within the automotive industry, especially as Tesla triumphantly claims the top four positions, marking a significant shift from its absence just 13 years ago. The Tesla Model 3 Performance leads the pack, demonstrating the extent of Tesla’s growth and influence in the market. The index, first introduced by Frank DuBois, a professor at American University’s Kogod School of Business, is more than just a list of vehicles; it aims to provide a detailed picture of how American-made each automobile is, incorporating a multitude of factors beyond just assembly location.
Tesla’s Dominance and Evolution of the Index
In a remarkable leap from 2013, when Tesla was nowhere to be found on the Kogod Index, the brand has now secured its place at the forefront, symbolizing an evolution in domestic automobile production. Frank DuBois created the index to complement the American Automotive Labeling Act (AALA) by adding essential criteria such as the location of research and development, percentage of U.S.-sourced labor, and the origins of key components, including the transmission and engine. This enhancement offers a more comprehensive understanding of a vehicle’s American-made content, moving beyond the surface-level criteria.
Over the past decade, the index has revealed shifting trends in the automotive industry, with foreign brands such as Volkswagen, Toyota, Nissan, and Honda slowly increasing their U.S. content since 2015. In contrast, domestic brands like GM, Ford, and Stellantis (which now owns Chrysler) have shown slight declines in their American-made components. For instance, Ford’s domestic content dropped from 65% to 54%, while Nissan saw a rise from 22% to 24%. These nuanced shifts highlight the ongoing competition and the dynamic nature of vehicle manufacturing in the United States.
Challenges with Electric Vehicles
Despite its comprehensiveness, the Kogod Made In America Auto Index faces particular challenges, especially as the automotive industry transitions to electric vehicles (EVs). Frank DuBois acknowledges the difficulty in accurately representing EVs within the index due to their unique component structures, such as the presence of motors and batteries instead of traditional engines and transmissions. This discrepancy complicates direct comparisons between electric, hybrid, and traditional gasoline-powered vehicles, adding another layer of complexity to ranking them accurately.
The presence of hybrids further amplifies these challenges, as they blend both conventional and electric components. This results in an even more intricate evaluation process, which DuBois and his team continually adapt to ensure accuracy. Although these obstacles highlight the limitations of the index, they also underscore the evolving landscape of the automotive industry and the need for adaptive and inclusive metrics that can reliably measure the American-made content of diverse vehicle types.
Insights from the Index and Future Directions
The 2024 Kogod Made In America Auto Index has generated substantial interest in the automotive sector, with Tesla capturing the top four spots, a remarkable transformation from its nonexistence just 13 years ago. Leading this impressive list is the Tesla Model 3 Performance, underscoring Tesla’s tremendous growth and impact on the market. Initiated by Frank DuBois, a professor at American University’s Kogod School of Business, this index is far more than a simple ranking of cars. It offers a comprehensive evaluation of how American-made each vehicle truly is, factoring in a wide array of criteria beyond just where the assembly takes place. This index assesses the domestic content of parts, labor, and other significant elements, providing a well-rounded understanding of each vehicle’s contribution to the American economy. Tesla’s dominance highlights the evolving landscape of the U.S. automotive industry and the increasing relevance of domestic production in a globalized market.
