Well, this is going to get me in trouble with the “buy American” crowd, but I can’t help myself.
What could be more American than a Camaro? It’s both a Chevrolet and a muscle car.
Except it’s built in Canada – with major parts made in Mexico and – the horror! – France.
Camaro’s V-6 engine is hecho en Mexico. The six-speed automatic comes from La France. The car itself is assembled in Ontario by Canadians. Only about half the car is technically American – and none of it is made by Americans.
Is it bad? Is it good? Does it matter?
It depends.
Mexican and Canadian and French workers are surely happy to have the work. American workers don’t have that work anymore, so probably they’re not happy.
In theory, though, American consumers should be happy. Exporting work (or buying components) from lower-cost markets lowers the end cost of the finished item to consumers.
It’s a fine theory, but is it true?
Maybe.
The 1969 Camaro – the one the current car is designed to emulate – had a base price of $2,726. Adjusted for inflation, that is $16,784 in 2011 dollars. (See here for the calculator.) You could order a Z28, the top-of-the-line Camaro – for another $458 or $3,184 total. That would be $19,604 in 2011 dollars.
The price of the 2011 base model Camaro is $22,805 – $3,201 more than the cost when new of a top-of-the-line 1969 Z28.
And the gap really widens if you compare the price of the ’69 Z28 with the MSRP of its 2011 equivalent, the $31,070 Camaro SS.
That’s an $11,466 spread between the two.
Now there are some mitigating factors. The new Camaro “base” model is a Cadillac in terms of the features and equipment it comes standard with compared with what you got in base model ’69 Camaro. For example, air conditioning, power windows and locks, a very good stereo and large alloy wheels are all included in the current car’s base price but were either big ticket options or not available at all back in ’69.
The government has also jacked up the MSRP of all new cars by forcing the car companies to install multiple air bags and comply with countless rules and regulations, none of them cheap or easy to comply with and which largely did not exist back in the late 1960s.
Still, the bottom line is the new Camaro’s a lot more expensive than the classic-era version.
Wasn’t free trade supposed to lower the cost of stuff?
Well, maybe it has!
I thumbed back a few pages to find out what the price of a more recent – and more directly comparable – Camaro was to compare that with the cost of the current one.
Back in 2002 a Camaro’s base price was $18,415. In today’s dollahs, that works out to $23,130. So the 2002 Camaro was actually more expensive, in real terms, than the current one. And unlike the ’69 it is a fairer comparison because the ’02 had most of the same features and equipment that the current one has, and had to comply with similarly onerous and expensive federal ukase.
So here’s what I come up with: Buying parts from other countries or assembling the car in other countries has made it feasible to keep the current car’s cost from getting completely out of hand – and maybe even saved consumers a couple of bucks along the way.
The new Camaro’s not cheap by any means, but it does cost slightly less than its recent predecessors – and it probably costs a whole lot less than what it would have cost had Chevrolet not taken advantage of cost-lowering measures such as bolting the engine together in Mexico, buying a transmission from France and putting the car together in Canada.
All these things are basically end-runs around the government and its costs. If you look at the price tage of a 2002 Camaro and the price of a 2011 Camaro, there doesn’t seem to have been much increase in the potential profit on the thing; the current car’s MSRP (in real, inflation-adjusted terms) is lower by about $1,000 – which doesn’t leave a helluva margin. Put another way, the dealer (and Chevy) start out “spotting you” $1,000 on the 2011 vs. where the haggling would have started on the ’02. I doubt they’re making any more money on the 2011 than they made on the 2002. Probably, they’re making a bit less.
As much as economic nationalists complain about the displacements caused by sending work – and thus, jobs – to places like Mexico (and Canada and France, too) the truth is that manufacturers face the proverbial Hobson’s Choice: It’s more expensive to build/work/buy here, so they can either charge more (and probably sell less) or they can try to lower the cost of building/working by building/working/buying outside of the United States.
It’s not ideal, perhaps – but it is what it is. And if they didn’t do it, I doubt we’d have cars like the 2011 Camaro at all.
Throw it in the Woods?
Of course what doesn’t get taken into account is the repair and or replacement costs of these foreign made components. To save up front, the consumer gets stung at the repair shop.
The last one was assembled in Quebec, I think in a factory that was built there in response to tax breaks, and torn down when they were not renewed.
So it was barely more American than the current model.