American versus Foreign vehicles Essay Examples & Outline
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American versus Foreign vehicles
When on thinks about buying a new car, various issues have to be considered. One has to ensure that he has the right care that will offer him/her the required functionality (Heitmann, 1-54). There is also a need for the assessment of the repercussions of the action on the entire economy and viability of the companies that produce the vehicles. In the United States, the temptations to buy the international brands made in Germany, Japan, and other countries are high. However, to make the decision translates into the contribution of the individual to the eventual collapse of the American companies such as General Motors and Ford (Beadle, 49).
Collapse of such companies eventually affects the person since the jobs will be lost, and the economy will be affected since the increased unemployment rate will demand that there is more investment in the social care system. These investments will require the investment of the government and hence increment of the tax burden. Therefore, the actions of the individual consumers will be contributory to the entire economic outcome. Therefore, the decision to buy the locally produced vehicles or imported ones will affect the economic status of the country. It is no longer an issue of the investment in a property. It proceeds to be a more important issue covering a vital sphere of the normal human existence, which is patriotism (Heitmann, 1-54).
One may wish to buy a local car since he/she is patriotic and wishes to contribute to the entire economic performance of his/ her country. However, the car specific issues come into focus and the decision to buy a locally produced car may not be shrewd since the performance obtained from the local car is low and costs of sustaining it is too high (Ingrassia, 1-103). Therefore, the cost-benefit analysis indicates that the car made in the United States is not working as expected, and the performance measures are too weak (Beadle, 46). Therefore, the only issue linking one to the locally produced car is the country of origin and the dedication towards the purchase of a locally produced car out of fear that choosing the alternative course of action will be detrimental to the economy (Heitmann, 1-54).
Information on the foreign or domestic nature of the vehicles does not align itself according to the name of the vehicles or even the location. In 2005, of the 63 million cars produced, the United States of America accounted for the production of the largest percentage with 11 million followed by Japan with ten million Germany and China with 5.5 million. However, some of the cars produced in the United States are designed and designated the foreign labeling.
The other cars used for the domestic market were built in Mexico or Canada (Heitmann, 1-54). The federal requirements of the domestic vehicles are that they are made of 75% of the local materials. The vehicles made in the neighboring countries are domestic since the components are made in the United States (Ingrassia, 1-103). Therefore, the tag indicating the country that a car is made in does not determine whether it is a foreign car or otherwise (Beadle, 23). The decision to produce the domestic cars in the neighboring countries is by large the costs of producing a vehicle in the countries are lower compared to the cost of producing the vehicles in the local factories.
The foreign companies produce their vehicles in the United States using the American labor and plants and research work. Therefore, the value of producing the vehicle comes from the local population. It means that the production of the vehicles in the American factories does not make them domestic enough since the components may be imported (Ingrassia, 1-103).
The picture is even murkier with the closer look into the foreign companies. The majority of the motor corporations in the United States have an investment in the rest of the producers in the other countries. General Motors and other large motor manufacturers have controlling stakes in the Japanese automobile production companies (Beadle, 1-52). Therefore, to some extent the production of the vehicles can be considered domestic since the capital used to drive the companies is American.
The cross-border ownership removes the foreign and local classification. Use of parts made in the United States leads to the reduction of the assertion of foreign and domestic depending on the location of the production facilities. The automotive nepotism is all about the names of the vehicles (Ingrassia, 1-103). It entails making decisions on the motor origin according to the names of the vehicles. It means that the assertion of the vehicles that are needed by the population are the ones that have the American origins. This approach stands regardless of the location of the production facilities (Heitmann, 1-54). For the sake of the article, a foreign vehicle is the one with a foreign nameplate while a domestic car has a local on the nameplate. The processes of production and location of the production facilities are not the primary determinants of the classification (Türkcan and Ates, 154-172).
The decision to buy any vehicle does not always assume the economic rationale since it is possible that an American company benefits from the sale of a Japanese vehicle (Heitmann, 1-54). Therefore, the decision to buy a vehicle rests on the actual utility that it will accord the user. American cars that will be guzzling fuel are not advisable to buy since the decision to purchase ought to incorporate the costs of running the vehicle (Beadle, 52). Another consideration made in the acquisition of the vehicles is the cost and the stability of performance (Hiraoka, 496). This means that the criteria to buy the vehicle does not depend on the manufacturer but rather on the cost of maintaining it and comparative utility derived from it (Ingrassia, 1-103).
Cost of the car will depend on the quality of service derived from increased use of the vehicle. Use of the vehicle ought to be free from encumbrances. It also has to entail the least possible cost of running and maintenance. It means that the decision assumes by extensive the interactions between the user and the vehicle (Ingrassia, 1-103). Hence, the name tag does not determine the decision to purchase the car (Beadle, 46). Cost is a major factor. In most cases, the cars that have a high reputation in the market often fetch a premium price despite the set manufacturers’ price being reduced (Chung, Mitchell and Yeung, 199-218).
Purchasing of the foreign automobile models affects the eventual economy. However, most of the major brands from the foreign companies have adopted and approach of setting their production facilities in the United States. These production facilities make the products that come out of the assembly line more American (Heitmann, 1-54). Therefore, the ideal criteria for the selection of the vehicles ought to be the utility derived from the vehicles (Chunyan, Shuli and Dan, 346-350). If a vehicle promises more service for fewer costs, it ought to be purchased regardless of the place of production. Secondly, if the car has a lower acquisition and maintenance costs, it can be obtained irrespective of the location of production (Beadle, 142). The availability of the auxiliary services should lead to the purchase of the vehicles produced locally.
Beadle, Tony. The American Automobile. New York: Smithmark, 1996. Print.
Chung, Wilbur, W Mitchell, and B Yeung. 'Foreign Direct Investment And Host Country Productivity: The American Automotive Component Industry In The 1980S'. J Int Bus Stud 34.2 (2003): 199-218. Web.
Chunyan, Zhao, Wang Shuli, and Ling Dan. 'On The Comparative Advantage Of China's Auto Engineering Industry'. Systems Engineering Procedia 3 (2012): 346-350. Web.
Heitmann, John Alfred. The Automobile And American Life. Jefferson, N.C.: McFarland & Co., 2009. Print.
Hiraoka, Leslie S. 'Foreign Development Of China's Motor Vehicle Industry'. International Journal of Technology Management 21.5/6 (2001): 496. Web.
Ingrassia, Paul. Crash Course. New York: Random House, 2010. Print.
Türkcan, Kemal, and Aysegul Ates. 'Vertical Intra-Industry Trade And Fragmentation: An Empirical Examination Of The US Auto-Parts Industry'. The World Economy 34.1 (2011): 154-172. Web.