Don’t look now, but fun discussions about which vehicles are the most American-made just got a little more serious. Unless you have purposefully been hiding (which some could understand), you’re aware of the back-and-forth whipsaw of tariffs, reciprocal tariffs, retaliatory tariffs. Sprinkled with a little tariff relief for autos and then a temporary truce with China for 90 days to further negotiate tariffs, it’s been an interesting spring.
Let’s cover how much tariffs could cost some automakers, and which vehicles top the list of most American-made — based on parts content, the workforce, and assembly sites– and will thus face less impact.
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A brief recap
The situation can easily become confusing and is constantly being updated, but essentially there is a 25% tariff slapped on imported vehicles as well as a 25% tariff on imported automotive parts. Here’s where it gets a little complicated, and why Cars.com’s 2024 American-Made Index is so important: The Trump administration provided a little relief on auto parts tariffs by giving credits for what is produced in the U.S.
As expected, these tariffs will have a significant impact on automakers’ bottom lines. General Motors said the tariffs would cost it between $4 billion to $5 billion in annual profit, and rival Ford Motor Company expects a $1.5 billion annual hit.
Toyota said it anticipates a $1.2 billion profit decline in only two months, while Honda expects its operating profit to drop nearly 60% in the current fiscal year after being hit with tariffs.
With that backdrop, here’s the list of most American-made vehicles, per Cars.com’s index. The list gauges criteria that include assembly location, parts content, engine and transmission point of origin, and U.S. manufacturing workforce.
Tesla’s New Model Y. Image source: Tesla.
- Tesla Model Y
- Honda Passport
- Volkswagen ID.4
- Tesla Model S
- Honda Odyssey
- Honda Ridgeline
- Toyota Camry
- Jeep Gladiator
- Tesla Model X
- Lexus TX
Here’s another quick list, which we’ll analyze in a second, based on the share of U.S. light-duty (passenger) vehicle sales from domestic assembly for the 2024 model year.
- Tesla (NASDAQ: TSLA): 100%
- Ford: 72.4%
- Stellantis: 66.8%
- Honda: 61.5%
- Toyota: 53.6%
- Subaru: 48.7%
- General Motors: 47.6%
There are a few takeaways and perhaps questions to answer. You might wonder why Ford and GM didn’t have any vehicles in the top 10 most American-made, yet Toyota expects to take the worst profit hit. That’s because while Toyota has recently upped its U.S. production, it still has key imported vehicles and parts — it imports roughly 1.2 million vehicles to the U.S. annually.
Let’s be clear that there are really no winners here amid potential tariff chaos. But Tesla maintains a high percentage of domestic parts and local manufacturing and should be well positioned in this regard. Its Model Y has taken the first spot in the rankings three years in a row.
That said, Tesla has a number of other things weighing on its stock, such as declining sales, questions surrounding its Robotaxi, and CEO Elon Musk’s political activities.
What it all means
Investing is all about thoroughly understanding the businesses you own, and information like this is highly valuable. It’s easier to understand why Ford is taking a smaller profit hit when we see it has more domestic assembly compared to Toyota and General Motors. Knowledge is key, and understanding the impacts and the underlying causes is important.
It’s important because these massive global auto supply chains don’t stop and change on a dime; it takes years and causes disruptions. The silver lining is that the tariffs could all change again tomorrow, so stay tuned — it could be a wild ride.
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Daniel Miller has positions in Ford Motor Company and General Motors. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends General Motors and Stellantis. The Motley Fool has a disclosure policy.