The Price of a Completely Domestic Vehicle in the U.S.: A Complex Matter

The Price of a Completely Domestic Vehicle in the U.S.: A Complex Matter

Rewritten Article:

Title: Assembling American Dreams: The Truth Behind "Made in the USA" Vehicles

Subtitle: Uncovering the hidden realities of US-made cars and the intricate global supply chains they rely on

With a shiny bronze exterior, a brand-new 2025 Ford Expedition rolled off the assembly line at Ford Motor's Kentucky Truck Plant. American workers had assembled the vehicle from the ground up, yet this all-American beast isn't entirely innocent of foreign ties. Five-Star General F-150's sibling is a strong testament to the labyrinthine nature of worldwide automotive manufacturing, pointing to the reality that even vehicles boasting American roots often lean heavily on international content.

The mammoth Kentucky plant, harboring over 9,000 US workers constructing Expeditions, F-Series trucks, and Lincoln Navigator SUVs, is the type of facility President Trump has been pressuring automakers to domesticate through aggressive tariffs. After Trump imposed 25% tariffs on imported vehicles and parts, auto companies scrambled to publicize their US investments and localize their supply chains as much as possible. However, while the nation would benefit from jobs and economic growth if all vehicle components were sourced and manufactured in the US, it's simply not feasible, experts say.

", said Martin French, a longtime supplier executive and partner at Berylls Strategy Advisors USA.

Manufacturing plants for materials like steel, aluminum, and semiconductor chips, especially older ones serving the automotive industry, are not plentiful enough in the US without establishing new plants or mines. acts expert, saying these processes would take at least a decade or more to create at scale. Furthermore, the increased costs of a 100% US-made vehicle could deter many consumers from entering the new vehicle market. This, in turn, could lead to less demand and reduced production.

"We can move everything to the US, but if every Ford is $50,000, we're not going to win as a company," said Ford CEO Jim Farley in a recent interview with CNBC's "Squawk Box." "That's a balancing act that every [automaker] will have to do, even the most American company."

Farley explained that 15% to 20% of commoditized vehicle parts are difficult, if not impossible, to source domestically. This includes small fasteners, labor-intensive wiring harnesses, and almost $5,000 in semiconductors per vehicle derived almost entirely from Asian sources.

Reports suggest that an average vehicle comprises a whopping 20,000 parts, originating from anywhere between 50 to 120 countries[2]. For the Ford F-150, which shares a platform and some parts with the Expedition, every component isn't exclusively American. Despite being exclusively assembled in the US, the F-150 boasts around 2,700 main billable parts, which exclude numerous tiny components[3].

The Trump administration could ease the financial burden posed by a 100% American-made vehicle by offering tax breaks or consumer incentives similar to the electric vehicle credit of up to $7,500 previously promised by Trump. However, the costs impacting a 100% domestically-sourced vehicle are far more extensive and intricate than they may initially appear. It's even challenging to track components originating from the US, as manufacturers are required to report a combined percentage of Canadian and US content in a vehicle, not solely US content.

In theory, a new car brand could be established in the US from scratch. Using billions of dollars, the company could construct new factories and create a completely domestic supply chain, but the resulting vehicle would likely have a limited market due to its high price and low volume. Multimillion-dollar sports cars from iconic brands like Ferrari boast components sourced from non-Italian suppliers.

"If you did it at really low volume and you're extremely innovative and different with the vehicle, you could make $300,000-$400,000 vehicles that are all-American," said , global automotive market lead at consulting firm AlixPartners. "To do it at scale, it would be 10-15 [years] and $100 billion to do that."

For now, achieving vehicles with 75% US and Canadian parts and final assembly in the US is a far more achievable goal that "doesn't really force you to do uneconomic things," Wakefield said, noting that several vehicles meet or surpass this standard today. However, even reaching this target on a larger scale would likely require billions of dollars in new investments from both automakers and suppliers to localize production.

In 2025, the Kia EV6, two versions of the Tesla Model 3, and the Honda Ridgeline AWD Trail Sport are expected to meet the 75% criterion, according to . Notably, 2007 model-year NHTSA data indicated that the top 16 vehicles — all from GM and Ford — boasted 90% or more US and Canadian content, as the Ford Expedition, at that time, ranked among the highest with 95%. However, experts believe this percentage has decreased due to the globalization of the auto industry supply chain after the Great Recession and significant technological advancements in automotive parts.

In conclusion, while widespread production of 100% US-made vehicles is highly challenging and likely to remain that way for the foreseeable future, achieving vehicles with 75% US and Canadian content seems much more plausible – without forcing unprofitable decisions or completely jeopardizing the allure of owning a new American vehicle.

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1. The intricate global supply chains rely heavily on international content, even for vehicles boasting American roots, as seen with the Ford Expedition.
2. The increase in costs of a 100% US-made vehicle could deter many consumers, potentially leading to less demand and reduced production.
3. Ford CEO Jim Farley mentioned that 15% to 20% of vehicle parts are difficult or impossible to source domestically, including small fasteners, labor-intensive wiring harnesses, and semiconductors.
4. Achieving vehicles with 75% US and Canadian content is a more achievable goal, requiring billions of dollars in new investments from both automakers and suppliers to localize production.
5. In 2025, cars like the Kia EV6, two versions of the Tesla Model 3, and the Honda Ridgeline AWD Trail Sport are expected to meet the 75% criterion, while vehicles from GM and Ford ranked high in US and Canadian content in 2007.
6. In the realm of finance and personal-finance, understanding the globalization of the auto industry, along with politics and general-news, can shed light on the economics of investing in this industry or related businesses, thanks to insights from reports and expert analysis.

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