The Effects of Buying Foreign Cars

The effects of buying foreign cars for many people the U.S. may seen like a negative on the surface. But looking closer, many will see that the benefits of creating competition for the big automaker benefited the U.S. consumer, actually created jobs domestically and pushed innovation. Coupled with an increasingly global economy, it becomes clear that through variety and competition, the consumer and the worker will benefit.

Forcing Competition

The SUV reigned supreme in the U.S. when foreign auto makers began to gain a foothold in the market. Honda and Toyota touted more streamlined and fuel-efficient vehicles that were easily customizable, while American automakers pushed higher-end, lower fuel economy vehicles on the strength of American craftsmanship and longer life of the auto itself.

The appeal of the foreign car increased as gas prices climbed to over $4 per gallon nationwide in 2008, and domestic automakers scrambled to produce a product. Americans buying foreign cars forced domestic automakers to innovate or die.

The Reality of the "American" Car

No car in the U.S. is produced entirely in-house anymore. Many automakers, including Ford and GM, maintain factories in Mexico, England and Sweden, producing different auto parts that are then assembled domestically at the company's home facilities. Purchasing an American car may assist a domestic auto maker's bottom line, but it does very little to secure American jobs.

The Reality for American Workers

Foreign car purchases have led to jobs in the U.S. Even with domestic automaker's hurting, Honda, Nissan and Mercedes all opened factories in the Sun Belt of the U.S. These foreign automakers have also expanded U.S. design and innovation facilities to gain a better understanding of the American market and provide more effective automobiles. In effect, buying foreign cars may have saved some jobs in this country and brought more here, too.