The automobile industry is considered a fundamental and complex industry compared to others due to the development process with every project. Arguably, the US is the world’s most open automotive market which for long. It has been a part of all major U.S trade development since WW1. The US has many automotive industries including; Fiat, GM, Nissan and Porsche to name a few. Despite all this variety, some consumers are not satisfied with local production and so they are opting to import cars of their choice they like more which are equipped with more and advanced technology, air-bags, antilock brakes, much comfort and reduced carbon going into the air. This move however, has caused many consumers to import foreign cars from countries such as Japan, Britain, China and others (Cockburn 112).
Automotive technology today continues to please many consumers across the world as more cars with better specifications are manufactured. Arguably, sports cars are credibly among the most recognized automobiles on earth. Nothing compares to the sound and sights of sports cars as they pass you on the highway with their quick burst of speed. Foreign cars or imports are increasingly becoming very popular in the automobile market today. The status of imported cars is quite encouraging with the number of American consumers driving BMWs, Hondas, Mercedes, Nissans and others. Foreign cars have become quite popular among various buyers due to the widespread belief in they are reliable. Another factor favouring imports of foreign cars is their ability to be designed to any shape or design which to many is quite pleasing and interesting (Levinson 112). Importation of foreign cars largely depends on the individual’s liking of that particular car they desire. However, despite all this arrangement in importing the cars, there are safety standards under the Motor Vehicle Safety Act of 1966 that ought to be followed. Subsequently, most of the imported cars are not in accordance with the standards. You find that some of these imported cars do not conform with the required safety standard which makes it very unlikely for a car obtained from abroad to meet all relevant standards.
Arguably, a nation abandoning its major manufacturing base is literally committing itself to economic dependence on countries overseas and corporations as well. Americans should realize that their country manufactures all types of vehicles to suit everyone. In addition, one can even have their car customized the way they need it. Therefore, importing cars from abroad is not advisable for these reasons; one, jobs in the US auto parts industries are at great risk due to unfairly traded and subsidized foreign auto parts. This is because auto parts and manufacturing industries contribute the most direct jobs close to 2/3 to the motor-vehicle sector. Seemingly, throughout the fifty states, there are over 1.6 million jobs which are either directly or indirectly supported by auto-parts industries which manufacture local cares (Kumar 712).
A close look at this issue suggests that importation of cars could have some profound effect to these industries. First, it could lead to unemployment of staff in these industries and an unstable economy especially in the automobile industry. For instance, importation of cars from China has increased more than twice as fast as employment in local car manufacturing companies due to the rapid growth in the importation of foreign cars leading to loss of jobs and a livelihood to thousands of Americans. Consequently, as more people import cars from abroad, it causes damage to the car industry in US due to priced car exports which causes the market share in US to decline and US causing it to represent less than a quarter of the world industry. For instance the top three since companies; GM, Chrysler and Ford have been declining since 2007. Today Chrysler is selling at 53%, Ford is down at 31% while GM is at 23%, a huge downfall. All these drops have in one way or another caused oversupply in uninspired dealers, car lots and difficult terms in finance (Greaney 432).
The US auto industry loses approximately 5,000 jobs to foreign competitors from car importation. Seemingly, the pain endured by the 500 households could be greater than all the benefits enjoyed by the household purchasing the car. Keeping jobs in America is of paramount importance especially in the industries that operate efficiently. Therefore, quality argument is normally put forth a coherent reason to secure jobs in the US. Supposedly, keeping money in the country should not at any one time be a priority. Therefore, it is of paramount importance to consider social and economic factors by limiting imports. This could be done and restricted by retaliating against protectionist policies (Cockburn 45).
On the side of it, importing a car is much of a hassle and expensive too compared to buying a car locally. For instance, importing a car across the border could cost as much as say £40,000 for ford. The air conditioning exercise tax would amount to $100, duty $1,900, RIV registration fee $200, green levy exercise tax $ 3000, total taxes amounting to $43,000 before licensing and emission fees. On the other hand, a car of the same level and standard bought locally at $38,000 and a few taxed posed on it could amount to $40,000 (Kumar 119). Combing with shipping costs, sales tax, custom and any other export tax can be quite costly to ship in a car in the US. There is indeed more hassle involved when importing a foreign car so I would strongly recommend one to purchase a car locally and save up some cash (Bhidé 434).
Notably, foreign vehicles are much different from local vehicles. Most of these foreign cars do not comply to the all the guidelines, rules and laws that are followed. You may find that some of these cars lack certain specifications that are pretty much required by a driver in the States. Such a scenario creates a lot of discomfort and fear of possessing a car that lacks certain requirements. In addition, some of the imported cars are very distinctive such that it is very difficult to find a spare part in your country. Instances when such a car breaks down and requires service means a lot of hard time and hassle. However, had the owner purchased a local car, all these hassles and bustle would not be experienced.
Though people have different tastes and liking, it is important to weigh things and determine what is manageable. There are numerous drawbacks associated with importing foreign cars in the US. One, it is way too expensive, secondly, there is a lot of hassle and hustle in the whole process of purchasing it, to shipping and receiving it. It also leads to unemployment of staff working in the US automotive organizations.
Works Cited
Bhidé, Amar, and Edmund Phelps. "A Dynamic Theory of China-US Trade: Making sense of the imbalances." Available at SSRN 763284 (2005).
Cockburn, Andrew. Rumsfeld: an American disaster. Verso, 2007.
Greaney, Theresa M. "Reverse importing and asymmetric trade and FDI: a networks explanation." Journal of International Economics 61.2 (2003): 453-465.
Kumar, Sameer, and Teruyuki Yamaoka. "System dynamics study of the Japanese automotive industry closed loop supply chain." Journal of Manufacturing Technology Management 18.2 (2007): 115-138.
Levinson, Arik. "Offshoring pollution: is the United States increasingly importing polluting goods?." Review of Environmental Economics and Policy 4.1 (2010): 63-83.
Bhidé, Amar, and Edmund Phelps. "A Dynamic Theory of China-US Trade: Making sense of the imbalances." Available at SSRN 763284 (2005).
