From Wikipedia, the free encyclopedia - View original article
Note: this article adopts the U.S. Department of Transportation's definition of a passenger vehicle, to mean a car or truck, used for passengers, excluding buses and trains.
The United States is home to the largest passenger vehicle market of any country in the world. Overall, there were an estimated 254.4 million registered passenger vehicles in the United States according to a 2007 DOT study. This number, along with the average age of vehicles, has increased steadily since 1960, indicating a growing number of vehicles per capita. The Chinese car market, however, is poised to soon exceed the United States; by the end of 2012, there were over 240 million cars on the road in China.
The United States is also home to three large vehicle manufacturers: General Motors, Ford Motor Company and Chrysler, which have historically been referred to as the "Big Three." Chrysler however is no longer among the top three; but is number five, behind Toyota and Honda. The motor car has clearly become an integral part of American life, with vehicles outnumbering licensed drivers.
The United States Department of Transportation's Federal Highway Administration as well as the National Automobile Dealers Association have published data in regard to the total number of vehicles, growth trends, and ratios between licensed drivers, the general population, and the increasing number of vehicles on American roads. Overall passenger vehicles have been outnumbering licensed drivers since 1972 at an ever increasing rate, while light trucks and vehicles manufactured by foreign marques have gained a larger share of the automotive market in the United States. In 2001, 70% of Americans drove to work in cars. New York City is the only locality in the country where more than half of all households do not own a car (the figure is even higher in Manhattan, over 75%; nationally, the rate is 8%).
According to the US Bureau of Transportation Statistics for 2009 there are 254,212,610 registered passenger vehicles. Of these, 193,979,654 were classified as "Light duty vehicle, short wheel base", while another 40,488,025 were listed as "Light duty vehicle, long wheel base." Yet another 8,356,097 were classified as vehicles with 2 axles and 6 tires and 2,617,118 were classified as "Truck, combination." There were approximately 7,929,724 motorcycles in the US in 2009.
According to cumulative data by the Federal Highway Administration (FHWA) the number of motor vehicles has also increased steadily since 1960, only stagnating once in 1997 and declining from 1990 to 1991. Otherwise the number of motor vehicles has been rising by an estimated 3.69 million each year since 1960 with the largest annual growth between 1998 and 1999 as well as between 2000 and 2001 when the number of motor vehicles in the United States increased by eight million. Since the study by the FHA the number of vehicles has increased by approximately eleven million, one of the largest recorded increases. The largest percentage increase was between the years of 1972 and 1973 when the number of cars increased by 5.88%.
In the year 2001, the National Automobile Dealers Association conducted a study revealing the average age of vehicles in operation in the US. The study found that of vehicles in operation in the US, 38.3% were older than ten years, 22.3% were between seven and ten years old, 25.8% were between three and six years old and 13.5% were less than two years old. According to this study the majority of vehicles, 60.6%, of vehicles were older than seven years in 2001. This relatively high age of automobiles in the US might be explained by unaffordable prices for comparable new replacement vehicles and a corresponding gradual decline in sales figures since 1998. Also, many Americans own three or more vehicles. The low marginal cost of registering and insuring additional older vehicles means many vehicles that are rarely used are still given full weight in the statistics.
The median and mean age of automobiles has steadily increased since 1969. In 2007 the overall median age for automobiles was 9.4 years, a significant increase over 1990 when the median age of vehicles in operation in the US was 6.5 years and 1969 when the mean age for automobiles was 5.1 years. Of all body styles, pick-up trucks had the highest mean age in 2001 (9.4 years), followed by cars with a mean age of 8.4 years and van with a mean age of 7.0 years. As SUVs are part of a relatively new consumer trend originating mostly in the 1990s, SUVs had the lowest mean age of any body style in the US (6.1 years). The average recreational vehicle was even older with a mean age of 12.5. For all body styles the mean vehicle age increased fairly steadily from 1969 to 2001.
In March 2009, RL Polk released a study conducted between 2007 to 2008 which indicated that the median age of passenger cars in operation in the US increased to 9.4 years, and that the median age for light trucks increased from 7.1 years in 2007 to 7.5 years in 2008. As of 2011[update], the median age for all vehicles in the US had risen to 10.8 years. While the age has increased the number of service/repairs has remained the same at 4.2 times per year. That number took a decline in 2010 to 3.6. This number takes into account cash for clunkers when approximately 850,000 vehicles were removed from the public domaine.
In the year 2009, in a largest decline during economic crisis, less than 6 million new passenger cars were sold in the United States, and the total number of new sold and leased cars and light trucks dropped to just above 13 million from a normal pre-crisis level above 20 million (more than 22 million in 2000)  according to the U.S. Department of Transportation. This figure "Includes domestic and imported vehicles." (Department of Transportation) The number of cars sold in the US was decreasing at a gradual yet continuous rate since 2000, when 9 million passenger cars were sold in the US. Looking back at history however, reveals that such decline is only part of normal market trends and most likely only a temporary problem, and after 2009 a strong recovery nearly restored sales and leasing to pre-crisis level in 2013. Overall, 1985 was a record year with cars sales totaling just over eleven million., while light truck represent nearly a half of new vehicle at present (2013), and in 2006 sales and new-vehicle leases for light trucks exceeded the number for cars by 6% (sales only exceeded by almost 12%).
While imports have been gaining ground in terms of units sold during the 2000s and have regained roughly the same market share they held in 1992, the sales of domestic vehicles are still more than double those of imported vehicles. It should be noted, however that the US Bureau of Transportation Statistics "Includes cars produced in Canada and Mexico" as domestic vehicles as both countries are part of the North American Free Trade Agreement (NAFTA), thus including many cars by Asian and European manufacturers - many Volkswagens are made in Mexico, Toyotas in Canada, also. In 2006 the sales of vehicles made in NAFTA states totaled 5.5 million, while the sale of imported vehicles totaled 2.2 million. 923,000 vehicles were imported from Japan, making it the greatest exporter of vehicles to the US. Germany was the second largest exporter of vehicles to the US, with 534,000 units exported to the US in 2006. Imports from all other nations, except Germany and Japan, totaled 729,000.
In July 2004, Edmunds.com published a report stating that the average sticker price on a vehicle sold in the United States was $29,746. However, in the US, passenger vehicles are commonly sold at considerable discounts and customers rarely pay the sticker price or MSRP (Manufacturer's Suggested Retail Price). The discount is commonly determined by the company's marketing strategies and tends to be larger the slower selling a vehicle is. Due to what many American consumers have perceived as a declining quality among the automobiles manufactured by the "Big Three" and large fixed labor and capital costs, discounts tend to be larger on domestic vehicles. In 2003 the average discount on a domestic vehicle was 20.6% below MSRP. For Japanese and Korean vehicles the average discount was 10% and 12.8%. The lowest discounts were given on vehicles from European manufacturers, where the average discount was 7.7% below MSRP.
Overall, the average discount in July 2004 was $4,982 (16.8%), meaning that while the average MSRP was almost $30,000, the average buyer of a new car paid only $24,764. Dr. Jane Liu, the Vice President of Data Analysis for Edmunds.com further stated that, "New models are being introduced at higher price points, but the competitiveness of the market is dramatically pushing down net prices, resulting in a record average discount." The lowest discounts among all car segments were given on luxury SUVs, where buyers received an average 10% discount, resulting in a $43,725 net price, versus the sticker price of $48,586.
The American automobile industry became notorious for the manufacture of gas guzzlers during the 1960s and 1970s when fuel prices and consumer awareness concerning fuel economy were at an all-time low. In the 1960s and 1970s, American-made cars took on enormous proportions as consumers placed their emphasis on comfort, power and style. Large sedans from this era came to be known as land yachts, often rivaling today's largest pick-up trucks in terms of length and width. In 1977, the Lincoln Continental Mark V was reviewed by the German automobile magazine, auto motor und sport and still holds the record for the worst fuel economy of any vehicle ever tested by the magazine with an average of 7 MPG.
Following the 1973 oil crisis; however, smaller vehicles, often imported from Japan, became more and more popular with the American public as these vehicles featured better fuel economy ratings. In the late 1970s, the US government passed minimum fuel economy standards and in the 1980s American automobile manufacturers drastically downsized their cars, only a few vehicles, such as those using the Ford Panther platform retained their over-sized glory. The downsizing did, however, backfire in some cases. After downsizing nearly the entire Cadillac line-up in the late 1980s, General Motors scrambled to save its most prestigious marques.
Many American manufacturers again increased the size of their vehicles in the 1990s, while better technology allowed for better fuel economy ratings among sedans. USDOT MPG statistics differ dramatically from Corporate Average Fuel Economy (CAFE) statistics, with the latter being a sales-weighted composite and therefore presenting a more realistic picture of fuel economy in the USA. For example, for 2008, the CAFE composite was 28.2 mpg, substantially larger than the 17.2 mpg compiled by the USDOT.
According to the United States Department of Transportation, the average motor vehicle, including light trucks, in the US had a fuel economy rating of 17.1 MPG or 13.8 liters per 100 kilometers. The average fuel economy for passenger vehicles in the United States has remained stagnant throughout the 1990s and 2000s, peaking in 2001 and 2004. The 90s saw the slowest increase in fuel economy since 1960, with fuel economy increasing from 16.4 MPG in 1990 to 16.9 MPG in 2001. This is in contrast to the 1980s when the average fuel economy improved somewhat more significantly from 13.3 MPG in 1980 to 16.4 MPG in 1990. The increase in fuel economy during the 1990s is largely due to the rising popularity of Sport utility vehicles (SUV), whose status as light trucks gains them exception from the fuel economy restrictions placed on sedans and other cars.
Mainstream mid-size sedans such as the Chevrolet Impala or Ford Taurus are often perceived to be the typical and most common body style in the United States. While mid-size sedans are indeed among the country's best selling vehicles, pick-up trucks held the top positions until mid-2008, rivaling sedans in the terms of total numbers sold. In the year 2006, the best selling models were the Ford F-Series with 796,039 units sold and the Chevrolet Silverado with 636,069 units sold. The Toyota Camry, Dodge Ram, and Honda Accord held the next three positions as the best selling cars. Rising oil prices stripped pick-up trucks of the " Best selling vehicle type" title in mid-2008. The Toyota Corolla currently holds the title.
The US was the largest producer of vehicles in the world in 2003, followed by Japan and Germany. While most vehicles sold in the US were manufactured by the Big Three, foreign corporations such as Japan's Toyota Motor Company have starting manufacturing in the US and are now an integrated part of the US automobile industry. According to many sources, the extended US operations of foreign based companies now rival those of American automobile manufacturers. For example, Toyota Motor Company now operates twelve manufacturing plants in the US, producing 1.55 million vehicles, 61.66% of the roughly 2.5 million vehicles the company sells in the US each year.
A wide variety of vehicles are manufactured in the United States, from compact cars to full-size luxury vehicles. The American automobile industry itself is probably best known for the manufacture of large cars, leading to the common public perception of American cars being larger than those from other countries and making the US well known for the production of so-called land yachts.
While the denotation of domestic vehicle includes all vehicles made in the United States, the term Domestic vehicle in the United States is usually only applied to vehicles made by the "Big Three" and their traditional marques. The term domestic vehicle does not include vehicles sold under marques who used to be headquartered outside the United States and are now owned by the Ford Motor Company or General Motors. Ironically, vehicles made outside the US by the traditional marques of the "Big Three" are considered to be domestic vehicles, while vehicles made inside the US by foreign manufacturers are not considered domestic, but rather import vehicles.
As with the term, domestic vehicles, there is a legal definition for import vehicles but popular usage of the term, and popular views of what constitutes an "import" vehicle, vary widely.
For the purposes of Federal regulations, such as Corporate Average Fuel Economy (CAFE) and the American Automobile Labeling Act of 1994 (AALA), vehicles produced in the United States, regardless of brand, are considered "domestic", while vehicles produced outside the United States are considered "imported".
However, many Americans view a Toyota vehicle made in Kentucky, a Saab built in Ohio, or a Mercedes-Benz vehicle made in Alabama as an "import", while others view a Pontiac vehicle made in Australia as a "domestic" vehicle. This perception is due to the respective brands' longstanding association with their parent countries: Toyota with Japan, Mercedes-Benz with Germany and Pontiac with the United States.
The country of origin of any particular vehicle can be easily determined:
The VIN identifies the vehicle's country of manufacture, and the company responsible for its production. Vehicles manufactured in the United States have VINs beginning with the numbers 1, 4, and 5 — regardless of where the company is based. Thus, a Toyota Camry made in the U.S. will have a 1, 4 or 5 at the start of its VIN, while one imported from Japan will begin with the letter J.
In the year 2000, according to an article in the magazine Motor, BMW attempted to label its "X5" Sport utility vehicle, made in Spartanburg, South Carolina with a VIN beginning with the letter W — indicating the vehicle was made in Germany. A spokesman for the Society of Automotive Engineers, the agency responsible for assigning the three-digit "World Manufacturer Identifier" that begins the VIN label, was quoted as saying "We assign (codes) according to the dirt the plant's built on, not the headquarters of the company."
"The Big Three" refers to the three largest automobile manufacturers headquartered in the United States. While there have been roughly 1,800 car manufacturers in the US over the course of the 20th century, only three large corporations with considerable sales numbers were left by the 1980s. The term is applied to General Motors, the Ford Motor Company, and the Chrysler Corporation.
General Motors is the largest automobile manufacturer in the United States and was also the world's largest for 77 years. However, in 2008, GM was passed by Toyota. GM is headquartered at the Renaissance Center in downtown Detroit, employs approximately 202,000 people, sold 9.025 million cars worldwide, and had a US$ 150.276 billion revenue for the year 2011. The corporation sells its vehicles in the United States under the following divisions and subsidiaries:
The Ford Motor Company (FoMoCo) was founded in 1903 by Henry Ford, and is America's second largest and the world's third largest vehicle manufacturer according to total sales volume. In 2005, the Ford Motor Company had a total revenue of $178.1 billion. The corporation sells vehicles under the following brand names and subsidiaries:
Formed in 1925 by Walter Percy Chrysler, the Chrysler Corporation has since been one of the most important American automobile manufacturers, consistently ranking as the third-biggest for most of the post-war period. The company followed GM's "move up" model, with the Chrysler brand (and the Imperial brand from 1955–1975) being the flagship luxury make.
In 1998, the Chrysler Corporation officially merged with Daimler-Benz of Germany, into a new entity, DaimlerChrysler (DCX), which is headquartered both in Stuttgart, Germany and Auburn Hills, Michigan (where the pre-merger headquarters of DaimlerBenz and Chrysler, respectively, were located). This raised a dispute on whether Chrysler (or, more specifically, the Chrysler Group within DCX, which consists of most former Chrysler Corporation operations and is headquartered in Auburn Hills) can still be seen as a domestic manufacturer. Nevertheless, the term "Big Three" still applied. Chrysler entered into bankruptcy in 2008, and is now owned by the Italian car maker FIAT and the United Auto Workers Union.
In 2005, the Chrysler Group employed 83,130 people and sold 2.83 million vehicles globally, generating $57.4 billion in revenue. Chrysler manufactures and sells vehicles under the following brands:
BMW opened its American manufacturing plant in Spartanburg, South Carolina in 1994, to manufacture the Z3 roadster, later replaced by the Z4 model. Since 2000, the plant also manufactures the X3, X5 and X6 SUV. All those models are made exclusively at Spartanburg for both the domestic market and worldwide exports (not counting CKD operations in some countries).
Fiat returned to the United States market after leaving in the 1980s as part of its partial acquisition of Chrysler. As of December 2011, Fiat sold only the 500 model, which is assembled in Mexico but has an engine manufactured in Michigan.
Honda was the first Japanese automaker to build a factory in the United States. Following the success of the Accord, the company opened a new plant in Marysville, Ohio in 1982 to assemble the model, which went on to become the most popular car in the US in 1989. Honda expanded their operations and the scope of models manufactured in the US, building the Anna engine plant and East Liberty automobile assembly plant, and in 2001 opening Honda Manufacturing of Alabama in Lincoln. Most models sold under the Honda and Acura brands in North America are currently manufactured in either the U.S. or Canada.
Others, such as the Honda Fit, Honda S2000, Acura TSX, and Acura RL, are imported from Japan. Some vehicles, such as the older CR-V (in the eastern United States) and the Civic SI hatchback, were imported from the UK. Some Accord passenger cars were imported from Mexico and starting from 2008 all CR-V's sold in the Americas are made in Mexico, in the early 2000s. In 2009, production of 4-door Civic sedans began at a new factory in Greensburg, Indiana.
Hyundai Motor Company started manufacturing in the United States in 2005, when their plant in Montgomery, Alabama started the production of the Sonata sedan. It was joined in 2006 by the new Santa Fe SUV.
The last Mazda 6 rolled off the line on Friday, August 24, 2012, with Mazda discontinuing production on American soil, effectively ending the 20 year joint-venture between Mazda and Ford. Mazda moved production of the Mazda 6 back to Japan and is opening a new factory in Salamanca, Mexico, to build the Mazda 2 and Mazda 3 subcompact and compact cars.
In 1997, a year before the merger of Damiler-Benz and Chrysler, the former Daimler-Benz followed the steps of their Bavarian competitor and opened a plant in Tuscaloosa County, Alabama, to serve as a worldwide production location for the new M-Class. The M-Class has since then been replaced by a new generation and joined by the new R-Class and GL-Class, also manufactured exclusively in Alabama.
Mitsubishi Motors entered the American market through a long-standing partnership with Chrysler Corporation, and later this partnership was extended into a 50/50 joint venture manufacturing operation named Diamond-Star Motors (DSM) in Normal, Illinois. In 1991, Mitsubishi took over Chrysler's share in DSM and in 1995 renamed it Mitsubishi Motors North America, Inc. (MMNA) Manufacturing Division. The plant has produced a number of Mitsubishi models and their Chrysler, Dodge, Plymouth and Eagle derivatives, and currently manufactures vehicles based on the American-designed PS platform - the Galant, Eclipse and Endeavor. Manufacturing of related Chrysler-branded vehicles was taken over by Chrysler Group, and while other related Mitsubishi vehicles are sold worldwide.
Nissan opened their first factory in the 1980s in Smyrna, Tennessee, joined in the new millennium by another plant in Canton, Mississippi. Most models sold under the Nissan brand in United States, as well as Infiniti QX56, are currently manufactured there. Unlike Toyota or Honda, the company does not have any manufacturing operation in Canada. However, Nissan maintains manufacturing operations in Mexico, from which its smaller U.S.-market cars like the Sentra are imported. Most North American models are specific to this market, although some models, like the Murano and Quest, are exported to other continents.
Subaru teamed up with fellow Japanese manufacturer Isuzu, forming a joint-venture called Subaru Isuzu Automotive to build and operate a manufacturing plant in Lafayette, Indiana. The plant made Subaru cars and Isuzu SUVs mostly for the American market until 2003, when Isuzu, facing faltering sales in America, decided to quit the venture selling their share to Subaru for $1 million. The plant continued to build Isuzu Rodeos under contract until the end of that vehicle's production run. From then on, the production was limited to Subaru models such as Legacy and its derivatives Outback and Baja, as well as the new B9 Tribeca. The two latter models are only built in Indiana for all markets where they are sold. After Toyota acquired a stake in Fuji Heavy Industries, the parent company of Subaru, it shifted some of the Toyota Camry production to the Lafayette plant.
Tesla is a Silicon Valley-based company that designs, manufactures and sells electric cars and electric vehicle powertrain components. Tesla Motors gained widespread attention by producing the Tesla Roadster, the first fully electric sports car, followed by the Model S, a fully electric luxury sedan. Tesla also markets electric powertrain components, including lithium-ion battery packs, to other automakers, including Daimler and Toyota.
Toyota's first foray into automobile manufacturing in the United States was NUMMI, a joint venture with General Motors based on the latter's production facility in California, which started in 1984 and has been manufacturing Toyota models and their versions branded as Geo, Chevrolet and Pontiac until GM withdrew in August 2009 and Toyota shut the doors in March 2010. Toyota went on to establish a number of wholly owned plants in states such as Kentucky, Indiana, California, West Virginia and Alabama. More than half of Toyota-branded vehicles sold in the United States come from American plants. Conversely, all Scions are imported from Japan. Lexus-branded models are imported from Japan or Canada (RX only).
The 2012 Volkswagen Passat is a mid-sized sedan which replaces the previous-generation Passat B6 in the North American market.The model is also shipped overseas to South Korea. The Passat NMS was officially announced in January 2011 at the Detroit Auto Show. Built at the Volkswagen Chattanooga Assembly Plant, the new Passat allows building and shipping costs to be reduced significantly over its predecessor making it more competitive to offerings from competitors at the $20K mark.