Whose Part Is It?—Measuring Domestic Content of Vehicles
The U.S. motor vehicle industry has
become more international and competitive
over the last few decades. Foreignowned
carmakers have a sizable presence
in the U.S. market through their sales
and production operations, and domestic
carmakers import
some vehicles for sale
in the U.S. market.
In the wake of increased
competition
in the industry,
Chrysler Group,
Ford Motor Co.,
and General Motors
Corp. (GM) are no
longer referred to
as the “Big Three”
because their market
share of U.S. vehicle
sales has been much
diminished; the U.S.
market share of these
carmakers, now
dubbed the “Detroit
Three,” fell below
50% for the first
time in July 2007.
While these changes
have occurred, the
U.S. motor vehicle
parts industry has also become more
international: Domestic carmakers rely
more on imported parts, foreign carmakers
increasingly use parts that were
produced in the U.S., and foreign parts
companies have established production
operations in North America. In 2006,
about 25% of parts used in the U.S. were
imported, and approximately another
25% were produced by U.S.-based operations
of foreign parts makers.