Economy, Technology
Tesla and Honda Dominate the 2024 American-Made Index
Jun
On Tuesday, Honda Motor highlighted its significant American presence, drawing investor attention amidst the ongoing drama surrounding Elon Musk and electric vehicles. And Tesla, too, reaffirmed its status as a leading American car manufacturer.
Tesla and Honda Shine in 2024 Rankings
The 2024 American-Made Index by Cars.com evaluates vehicles based on factors such as parts sourcing and final assembly locations. In this year’s index, the Tesla Model Y secured the top position for the third consecutive year. This index highlights vehicles that are the most “American-made,” considering various criteria beyond just assembly in the U.S.
While the Model Y continued its reign, the Tesla Model 3 experienced a notable shift. Previously a top-10 finisher in 2022 and 2023 and the number one vehicle in 2021, the Model 3 slipped to 21st place this year. Despite this decline, Tesla maintained a strong presence in the market. For the third consecutive year, at least three Tesla models ranked in the top 10.
Tesla’s Local Sourcing Challenges
Cars.com attributed the Model 3’s decline to decreased local parts sourcing and competitive improvements from other automakers. Consequently, Tesla’s more affordable all-electric sedan now stands at 21st on the 2024 list. The top 10 vehicles for 2024 are: Tesla Model Y, Honda Passport, Volkswagen ID.4, Tesla Model S, Honda Odyssey, Honda Ridgeline, Toyota Camry, Jeep Gladiator, Tesla Model X, and Lexus TX.
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Interestingly, six of the top 10 vehicles come from foreign automakers, with Honda contributing four, the most of any single brand. This trend highlights the globalization of the automotive industry. Vehicles are frequently manufactured near their sales markets, influenced by factors such as tariffs. Recently, President Joe Biden increased import tariffs on Chinese vehicles to about 100%, aiming to protect domestic manufacturers.
Ford and GM’s Struggle for Top Spots
Neither Ford Motor nor General Motors managed to place a vehicle in the top 10. The highest-ranking GM vehicle was the Chevy Colorado at 23rd place, while Ford’s Lincoln Corsair ranked 29th. However, Ford’s absence from the top doesn’t tell the whole story. With 72% of its U.S. sales derived from vehicles manufactured domestically, Ford trails only Tesla, which builds all its American-market cars in its California and Texas plants.
General Motors, despite not having any top-10 contenders, leads in total entries with 18 vehicles in the top 100, followed by Toyota with 15. This widespread presence underscores GM’s extensive production footprint across the U.S.
Consistent Performers
Both Tesla and Honda had another robust showing. In the 2023 Index, Tesla dominated the first four spots, with the Model Y at the top, followed by the Model 3, X, and S. Honda, along with its luxury brand Acura, secured five of the top 10 positions in 2023.
Looking ahead, investors are curious about Tesla’s new Cybertruck, which started deliveries at the end of 2023. This futuristic vehicle wasn’t included in the 2024 Index as it was not shipping when the evaluation began. However, analysts expect it to be a strong contender for the 2025 list after a full year of production and sales.
Market Reactions and Stock Performance
In the stock market, Tesla shares dipped 0.3% early Tuesday to $186.90. Meanwhile, the S&P 500 remained steady, and the Nasdaq Composite edged up by 0.1%. Ford shares decreased by 0.2%, and GM shares rose by 0.2%.
Tesla stock had surged 5.3% on Monday, climbing nearly $10, or almost 6%, after shareholders re-approved CEO Elon Musk’s 2018 compensation package. This package includes about 300 million stock options, potentially worth around $50 billion today. In January, a Delaware judge annulled these options due to insufficient disclosures to shareholders.
Overall, the 2024 American-Made Index underscores the strong market positions of Tesla and Honda. It also highlights the shifting dynamics in the automotive industry as it navigates global supply chains and domestic manufacturing priorities.
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