THE MOTLEY FOOL
The revival of the American auto industry is long under way. Since exiting the recession the big three in Detroit have witnessed incredible success as consumers' appetite for new vehicles has been practically insatiable.
Point your finger at whatever you like -- the growing U.S. economy, historically favorable lending rates, or sleek new car styles and interior gadgets and luxuries -- as they're all correct answers as to why U.S. auto sales reached 15.6 million in 2013.
But,underlying the surge in U.S. auto sales is a trend that Cars.com uncovered in a report this week in which it highlighted the top 10 American-made vehicles.
Source: Ford.
A noticeable shift in the U.S. auto industry
In its report, which focused on automakers whose vehicles were comprised of at least 75% domestic parts and were built in the U.S., Cars.com notes that just 10 vehicles, total, qualified this year. By comparison, this is down from the 30 vehicles that qualified for ranking in 2011.
More and more we're seeing automakers turn to vendors outside the United States' borders for cheaper parts in order to cut costs and keep vehicle prices from soaring through the roof.
Of course, not every manufacturer has turned to foreign markets for inexpensive goods. As Cars.com's American-Made Index demonstrates, there are at least 10 vehicles still left that are built with a minimum of 75% made-in-the-USA parts!
One, however continues to stand out among the crowd, taking the top honor as the most "American" vehicle in back-to-back years, and in five of the nine years that Cars.com has compiled its data.
Do you have a guess to venture as to which vehicle this might be?
Got your pick?
Did you say the Ford (NYSE: F ) Mustang or Chevy Corvette? If so you ventured a formidable guess and even managed to pick out one of the top 10 vehicles in the Corvette.
However, if you said the Ford F-150 then you've hit the bull's-eye.
2015 Ford F-150. Source: Ford.
Keep these biases in mind
Before we dive into what makes the F-150 the most "American" vehicle, we should first tackle two of the primary biases behind Cars.com's report.
On one hand, its data does help provide insight into which automakers are using U.S.-based parts, which, in turn, could provide clues as to what models consumers are more likely to form an emotional attachment to.
In theory, by playing up their patriotic ties the automakers behind the 10 vehicles in Cars.com's report could improve the marketability of their cars.
On the other hand, the third criterion in Cars.com's American-Made Index (beyond just being manufactured with 75% domestic-made parts and being assembled in the U.S.) focused on total sales.
The Ford F-150 has been a staple among the best-selling vehicles for decades, so it's pretty much a lock to either take the top spot of second place each year based solely on that accord.
Also, we have to take into account that Cars.com's report doesn't take emotional attachment, brand history, model history, or feelings of brand patriotism into question when compiling its results.
It's merely focusing on where the parts come from, where it's manufactured, and how many vehicles sold in the U.S. Period! To that end, there are variables which aren't fully in play here based on Cars.com's study.
Why the F-150 is America's truck
Yet, even with the biases inherent in this report it does indeed shed light on America's best-selling vehicle, the Ford F-150.
There are a number of reasons Ford's F-150 continues to sit atop the best-sellers list year in and year out.
First, as The Wall Street Journal reported this week, Ford, in general, and the F-150 have a rich attachment to the U.S. military. A survey conducted by Polk using registration data from IHS Automotive shows that the F-150 is the most popular vehicle among active, retired, or veteran military personnel. In addition, the ratio at which military personnel purchase the F-150 is higher than with the general population.
Current and former military personnel appreciate its ruggedness and dependability, but sales may also benefit from the fact that Ford has a long history of supporting military personnel. Having intricate tie-ins with the U.S. military is one surefire way to be deemed the most American vehicle.
Secondly, and tying this in with another survey that was released by Polk just a week ago, Ford ranks the highest of all auto manufacturers when it comes to brand loyalty. Per the Polk study, over a 10-year period 64% of consumers who purchased a Ford were likely to purchase another Ford or Ford-brand vehicle as their next vehicle.
By comparison, overall brand loyalty as an average dipped to 51%, representing a somewhat overwhelming number of options now present on the market. What this signifies is that Ford is clearly hitting the mark with consumers when it comes to design, value, new technologies, and fuel-efficiency.
Third, Ford is innovative and the F-150 has been a regular stepping stone to showcase its new innovations. For example, the all-new 2015 F-150 was introduced earlier this year with an aluminum frame which replaces its traditional steel frame.
The switch removes about 700 pounds from the final product allowing for better fuel efficiency -- but, that's just the beginning. Shedding 700 pound allows customers the ability to readd options that previously would have been a drag on fuel-efficiency, such as beefing up the payload or tow capacity.
Fourth, the aluminum frame also allows Ford to introduce a number of engine options that require less fuel to power the truck, including a 2.7-liter and 3.5-liter EcoBoost engine and a 5.0-liter V8. These options make its previous 6.2-liter V8 look like a gas-guzzler and give consumers the confidence that they're buying a fuel-efficient and cutting edge vehicle that's not going to be obsolete anytime soon.
Finally, there's a rich and storied history behind the brand and the F-Series. According to Ford, its F-Series had held the top spot as America's best-selling truck for a ridiculous 37 years and has been America's top-selling vehicle for the past 32 years. Consistently remaining in the spotlight as America's top-selling vehicle implies to consumers that it's a dependable, well-made vehicle -- ergo the motto "Built Ford Tough."
Combined, these factors would appear to indicate that F-150 sales are unlikely to slow anytime soon. As long as Ford remains innovative and continues to procure the majority of its F-150 parts from within the U.S., there's a good chance it'll experience a healthy boost in its bottom line from the patriotic connection that many consumers feel toward the brand.
Point your finger at whatever you like -- the growing U.S. economy, historically favorable lending rates, or sleek new car styles and interior gadgets and luxuries -- as they're all correct answers as to why U.S. auto sales reached 15.6 million in 2013.
But,underlying the surge in U.S. auto sales is a trend that Cars.com uncovered in a report this week in which it highlighted the top 10 American-made vehicles.
Source: Ford.
A noticeable shift in the U.S. auto industry
In its report, which focused on automakers whose vehicles were comprised of at least 75% domestic parts and were built in the U.S., Cars.com notes that just 10 vehicles, total, qualified this year. By comparison, this is down from the 30 vehicles that qualified for ranking in 2011.
More and more we're seeing automakers turn to vendors outside the United States' borders for cheaper parts in order to cut costs and keep vehicle prices from soaring through the roof.
Of course, not every manufacturer has turned to foreign markets for inexpensive goods. As Cars.com's American-Made Index demonstrates, there are at least 10 vehicles still left that are built with a minimum of 75% made-in-the-USA parts!
One, however continues to stand out among the crowd, taking the top honor as the most "American" vehicle in back-to-back years, and in five of the nine years that Cars.com has compiled its data.
Do you have a guess to venture as to which vehicle this might be?
Got your pick?
Did you say the Ford (NYSE: F ) Mustang or Chevy Corvette? If so you ventured a formidable guess and even managed to pick out one of the top 10 vehicles in the Corvette.
However, if you said the Ford F-150 then you've hit the bull's-eye.
2015 Ford F-150. Source: Ford.
Before we dive into what makes the F-150 the most "American" vehicle, we should first tackle two of the primary biases behind Cars.com's report.
On one hand, its data does help provide insight into which automakers are using U.S.-based parts, which, in turn, could provide clues as to what models consumers are more likely to form an emotional attachment to.
In theory, by playing up their patriotic ties the automakers behind the 10 vehicles in Cars.com's report could improve the marketability of their cars.
On the other hand, the third criterion in Cars.com's American-Made Index (beyond just being manufactured with 75% domestic-made parts and being assembled in the U.S.) focused on total sales.
The Ford F-150 has been a staple among the best-selling vehicles for decades, so it's pretty much a lock to either take the top spot of second place each year based solely on that accord.
Also, we have to take into account that Cars.com's report doesn't take emotional attachment, brand history, model history, or feelings of brand patriotism into question when compiling its results.
It's merely focusing on where the parts come from, where it's manufactured, and how many vehicles sold in the U.S. Period! To that end, there are variables which aren't fully in play here based on Cars.com's study.
Why the F-150 is America's truck
Yet, even with the biases inherent in this report it does indeed shed light on America's best-selling vehicle, the Ford F-150.
There are a number of reasons Ford's F-150 continues to sit atop the best-sellers list year in and year out.
First, as The Wall Street Journal reported this week, Ford, in general, and the F-150 have a rich attachment to the U.S. military. A survey conducted by Polk using registration data from IHS Automotive shows that the F-150 is the most popular vehicle among active, retired, or veteran military personnel. In addition, the ratio at which military personnel purchase the F-150 is higher than with the general population.
Current and former military personnel appreciate its ruggedness and dependability, but sales may also benefit from the fact that Ford has a long history of supporting military personnel. Having intricate tie-ins with the U.S. military is one surefire way to be deemed the most American vehicle.
Secondly, and tying this in with another survey that was released by Polk just a week ago, Ford ranks the highest of all auto manufacturers when it comes to brand loyalty. Per the Polk study, over a 10-year period 64% of consumers who purchased a Ford were likely to purchase another Ford or Ford-brand vehicle as their next vehicle.
By comparison, overall brand loyalty as an average dipped to 51%, representing a somewhat overwhelming number of options now present on the market. What this signifies is that Ford is clearly hitting the mark with consumers when it comes to design, value, new technologies, and fuel-efficiency.
3.5-liter EcoBoost engine. Source: Ford.
The switch removes about 700 pounds from the final product allowing for better fuel efficiency -- but, that's just the beginning. Shedding 700 pound allows customers the ability to readd options that previously would have been a drag on fuel-efficiency, such as beefing up the payload or tow capacity.
Fourth, the aluminum frame also allows Ford to introduce a number of engine options that require less fuel to power the truck, including a 2.7-liter and 3.5-liter EcoBoost engine and a 5.0-liter V8. These options make its previous 6.2-liter V8 look like a gas-guzzler and give consumers the confidence that they're buying a fuel-efficient and cutting edge vehicle that's not going to be obsolete anytime soon.
Finally, there's a rich and storied history behind the brand and the F-Series. According to Ford, its F-Series had held the top spot as America's best-selling truck for a ridiculous 37 years and has been America's top-selling vehicle for the past 32 years. Consistently remaining in the spotlight as America's top-selling vehicle implies to consumers that it's a dependable, well-made vehicle -- ergo the motto "Built Ford Tough."
Combined, these factors would appear to indicate that F-150 sales are unlikely to slow anytime soon. As long as Ford remains innovative and continues to procure the majority of its F-150 parts from within the U.S., there's a good chance it'll experience a healthy boost in its bottom line from the patriotic connection that many consumers feel toward the brand.
Warren Buffett’s worst auto-nightmare (Hint: It’s not Tesla)
A major technological shift is happening in the automotive industry. Most people are skeptical about its impact. Warren Buffett isn’t one of them. He recently called it a “real threat” to one of his favorite businesses. An executive at Ford called the technology “fantastic.” The beauty for investors is that there is an easy way to invest in this mega-trend. Click here to access our exclusive report on this stock.
A major technological shift is happening in the automotive industry. Most people are skeptical about its impact. Warren Buffett isn’t one of them. He recently called it a “real threat” to one of his favorite businesses. An executive at Ford called the technology “fantastic.” The beauty for investors is that there is an easy way to invest in this mega-trend. Click here to access our exclusive report on this stock.
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