Five Reasons to Say Yes to American Cars

The government hath spoken–and declared it safe to buy an American-made car.

By vowing to honor the warranties for cars built by General Motors (GM) and Chrysler, the Obama administration has removed a bit of the stigma associated with the two troubled automakers. Both need billions in emergency government loans to remain solvent and transform their operations, and bankruptcy remains an option. By pledging to stand behind the warranties, the government removes the fear that buyers may be spending lots of cash on a product the manufacturer won't be able to support if it goes out of business.

Still, these remain trying times for GM and Chrysler, and to a lesser extent for Ford (F), which hasn't asked for bailout money (yet). So if you're a car shopper who's on the fence, here are some reasons to take the plunge and buy domestic:

Quality is up. Consumer Reports says that some Ford vehicles “now rival the best from Japan.” In the latest J.D.Power dependability study, GM's Buick division tied with Jaguar for the top spot, beating out Lexus and Toyota (TM). And in 8 of 11 car segments, a GM model came in as one of the top three vehicles. Not all Detroit products are top-notch, so buyers should be sure to check individual car ratings at sites like Consumer Reports (which charges a fee), or U.S.News's Best Cars and Trucks, which is free.

They've got your back. GM and Ford recently rolled out “payment protection plans,” at no extra charge, that will cover your monthly payment for several months if you lose your job. Ford's plan covers up to 12 months of payments as high as $700 per month. GM's plan covers up to nine months of payments, up to $500 per month. (They're both copying Hyundai (HYMLF.PK), which started offering three months of payment protection in January.) And GM has a separate plan to make cash payouts to buyers who purchase a GM vehicle today but can't afford to trade it in down the road, because they owe more than the vehicle is worth. As with all promotions, buyers should read the fine print, scan for surprise exclusions, and make sure they buy a car that suits their needs and fits their budget, regardless of incentives.

Styling is cool. There's still a kind of muscular styling that's uniquely American, evident in vehicles like the forthcoming Chevy Camaro, the Dodge Charger, the Pontiac G8 and the Ford Mustang. When other makes try to mimic American muscle cars, the result is often more comical than compelling. And nobody can replicate the rugged appeal of Jeep, which remains one of the world's most iconic brands despite reliability that's consistently below average.

They're a bargain. The Detroit 3 know they need to try harder in order to sell cars, which means they often price less them below top models from Toyota, Honda (HMC), and other competitors. The Ford Fusion, Chevy Malibu, Toyota Camry, and Honda Accord are all priced about the same, for instance, and all have similar quality ratings. But Ford is offering rebates of up to $3,500 on the Fusion, while Chevy is offering 0 percent financing on the Malibu. Toyota, by contrast, is discounting the Camry by just $1,500, and Honda offers no discounts on the Accord. Big discounts–a Detroit staple for years–often means a lower trade-in value down the road, but for many buyers it helps buy a decent ride today.

To support a cause. Many Americans oppose the bailout of GM and Chrysler, but others feel it's time to show some support for the home team. Boosting the American automotive industry could save jobs, help spur the development of new technologies here instead of overseas, and maybe even lead to Detroit's resurgence. Buying one of their cars is one way for ordinary individuals to try to make a small difference, the same way environmentalists might buy a hybrid, even if it doesn't save them money. So maybe it's time to park some patriotism in your driveway.

Disclosure: no positions

Comments

[vvti:]

Excellent article. I have a lexus ls400 and Cadillac DTS...and guess what? The Cadillac was cheaper to buy, is cheaper to run, is MORE reliable, is more comfortable....what can I say? Go GM!

Apr 01 01:42 PM

[Tomas04:]

Time to start investing in this country.

Apr 01 01:54 PM

[User 387034:]

Hey Rick Newman, Pick a side. You write 2 one says buy american they are the best, the other says don't buy american they are horrible. Which is it.

Apr 01 02:10 PM

[bobbobwhite:]

Used to buy Detroit cars/trucks, but have had 5 Honda/Acuras over the past 33 years. Kept each an average of 150k miles; 800k miles total and one repair( one repair in 800k miles!) for warped brake rotors at 110k miles on an '81 Accord. I do take good care of my cars, but I did that with my Detroit makes too. The last Ford I bought in 1973 needed new wheel bearings, power steering pump, spark plug wiring, and a gas tank switchover(2 tanks in PU) in 30k miles!

Which cars do you think I prefer now? Absolutely no comparison, as I would have to see something other and much better than the 3 year old Ford I saw lately with plastic side view mirrors cracked and falling off the car(taped on with duct tape!) due to sun deterioration. Real quality, huh? No thanks.

Apr 01 02:31 PM

[bobbobwhite:]

You read like the new Chevy truck TV ads with Howie Long where he states one or two favorable comparisons with a top foreign brand and leaves out the other 1000 comparisons where the foreign vehicle is much superior.... like resale value, reliability, fit and finish, materials quality, etc. It seems to me you are slanted toward Detroit no matter what.


On Apr 01 01:42 PM vvti wrote:

> Excellent article. I have a lexus ls400 and Cadillac DTS...and guess
> what? The Cadillac was cheaper to buy, is cheaper to run, is MORE
> reliable, is more comfortable....what can I say? Go GM!

Apr 01 02:37 PM

[canoeguy:]

I think it is a bit unfair to compare US car quality from 36 years ago to the present day product.

I have a 1996 Chevy Tahoo with 309,000 miles and climing. Repared the transfer case for the 4 wheel drive once and replace the fuel pump every 80,000 miles. It runs like a top and rides like a luxury car.

BTW if you look in the ratings, 1996 was a bad year for a Tahoo.

Don't forget most "import cars" are assembled here now.

Apr 01 02:48 PM

[Thadeus Tho...:]

I just hope GM rethinks what brands it might do away with. Saturn has the most unique and European designed and engineered vehicles in GM's stable. The Saturn Aura is a great buy, especially now. I test drove a Honda Accord and Toyota Camry. I bought an Aura after a friend recommended it, and it compared favorably to the fore mentioned at $2,200 to $4,500 less. It has European, styling, amenities, and handling. I'm getting 23 to 26mpg around town, and have gotten between 31 and 36 on the highway. The Astra is not too shabby, but due for a makeover as the Aura is. The "new" Aura will be like the new 2010 Buick La Crosse. It is based on the Opel Insignia, quite a nice car. Also, the Saturn Vue is actually made after a similar model GM has made in Belgium and sells in Europe.
I hope GM reconsiders and doesn't shoot itself in the foot as it has done so many times, unfortunately. I have always thought an average car savvy person would make better product choices than GM often did.

Apr 01 03:10 PM

[Speedzzter:]

This is the same Rick Newman who was breathlessly shilling for Japanese cars over on the other thread?

Apr 01 03:23 PM

[Thadeus Tho...:]

He is. .. indeed, one and the same. LOL

I think these guys need to write a lot to stay employed too. Can't blame them. .. I guess. :D

Apr 01 03:38 PM

[babyray:]

I would not drive a foriegn vehicle if it was givin to me. Be American!! Buy American!! Drive American!! or go live in Japan, China, Korea or Germany!!

Apr 01 03:39 PM

[nothanks:]

Rick Berman: speaking with forked tongue?

Either that, or his split personality is surfacing again.

Go Detroit!! Go USA!! You can place your Asian autos where the sun don't shine.

Apr 01 03:40 PM

[robert99:]

If you support free markets and the principles that underlie free markets, you don't buy vehicles to 'support the home team.' Period. If I can get a better value from Honda or Toyota than I can from GM and Ford, that's what I am going to buy. Right now though, the best values are to be found in American car makers, for the reasons stated in the article: quality is light years beyond what it used to be, and they are selling at steep discounts, usually with 0% financing. If i were to buy a new car right now, it would either be a Hyundai or a Ford. Hyundai because the Genesis Coupe is a sweet ride at a bargain price, and Ford because all things being equal (quality/price), I will pick the automaker that did not receive bailout funds.

Apr 01 04:09 PM

[Miken:]

Thank you Mr. Newman. What a relief to see someone in the media giving U.S. cars a break. Now if only the U.S. government would do its job and develop an energy policy, industrial policy and a health care policy the American car companies could be viable WITHOUT loans.

Many other countries understand what a manufacturing base means to a successful economy. The value stream is significantly more beneficial than any other sector. Real people work in manufacturing...we're not trying to scheme another fancy financial tool that is unregulated so we can steal money from people. We aren't selling something that others made. We're not just adding our mark up, we're adding our VALUE.

Thanks again.

Apr 01 04:33 PM

[User 387116:]

Thanks for your view point. I've tried to buy American over the Years as a matter of social and economic responsibility; I' ve been willing to patch up and repair where ever the product lacked.

I can tell you that the products have improved. Our Chevy Trailblazer(2006) has been an excellent car as is our (2007) Saturn ION.

I sure hope that some folks will give the domestic boys(Big 3) another chance, as thier cars seem to be up to par; it is understandable that after some one is burned it's hard to trust again.

I hope you all are doing well during these troubled times.

tommy

Apr 01 04:34 PM

[Thadeus Tho...:]

A glimmer of hope. GM sold some 155,00 light vehicles in March which is up from February, but of course, down from last year. Up is... up isn't it? Also, GM sold almost 17% more vehicles than Toyota with Ford only about 1,700 units behind.
Here's hoping this crisis has helped GM, Chrysler and Ford to get leaner. The cars are very much on par with the competition, if people would just take a look, take a test drive, and see the value in the American BRAND cars.

Apr 01 05:48 PM

[bigmoney:]

my approach has been that if you want to buy new auto, buy Japanese, such as a Honda. But for a really good deal, get a used American car, maybe 3-5 years old. American cars have style / image problems, but are nearly as good as the Japanese. This means you can scoop up a used model and get a good deal.

Apr 01 10:08 PM

[Son of a Ch...:]

On other sites I sometimes read comments from people that are comparing old 1972 chevy cars with their brand new Toyota etc... Well, it's becoming a well known fact that cars and trucks made by GM and Ford have became some of the best quality autos sold today. I have owned several in my lifetime, and since 1999 I have noticed a huge increase in Chevy quality. I drove my 1999S-10 for 110,000 miles without a single mechanical failure- I only had to change my 1000,000 mile sparkplugs and wires after 105,000 miles and it only cost me $50 and 30 minutes of my time. I latter sold the truck only so I could replace it with a newer Chevy Colorado truck made in 2005- So far no major problems in four years and almost 80,000 miles on it.

Also I really wish the people that I read comments from on some other sites would stop acting like nobody wants or buys American cars, because the fact is people do! Where I live at I see over 50% American made cars and trucks on the road, with Chevy being very popular here in Kentucky,

This state in which Toyota has a plant, and I have seen my share of Toyotas broke down on the side of the roads here- fact is they are not perfect, as any mechanical product has many moving parts and toyotas and hondas break down as much as the older American cars do. It's important to give the new American cars and trucks a chance, as they have came a long ways since the poor quality days of the 1970s- but, we had many products sold in that time era that was of shoddy quality too. Sad so many act jealous of what some workers get paid, but I feel many Americans refuse to buy American cars to spite workers they feel are over paid. If anything is biting off your nose to spite your face that is. Good paying jobs create other jobs around them. Money is what makes a healthy economy run.

Apr 02 10:57 PM

[Fredric Wil...:]

I have a couple of problems with the analysis.

First of all, President Obama promises to take care of the warranties on all new GM and Chrysler cars (nice deal). Will he do this out of his own pocket? A presidential slush fund? Doesn't this require legislation? Isn't it just another late-blooming campaign promise -- still waiting for fulfillment?

If I were at GM/Chrysler, I'd give a 10-year, 200,000-mile warranty right away. Hey, Obama promised -- the sky's the limit.

GM promises to make the payments if I can't? Really? Is this the same GM that is on the verge of bankruptcy? Pay with what? Sounds like an Obama promise without the Obama.

As for quality, I've long accepted the reliability of Consumer Reports, which is independent of advertisers. JD Power earns money from automobile manufacturers, automobile dealers and their associations. It is not an independent or reliable source. Neither are comment writers, who have experience with just a handful of cars out of the 250 million on the roads.

Buying a car from a manufacturer that is thinking of abandoning entire brands and is facing bankruptcy seems a bit risky. My daughter has a Daewoo, which faced bankruptcy before being bought by GM. Repairs are a serious problem in the U.S., since there are no dealers. It might be wiser to buy a car from a company that will be around for a while -- and I'd prefer a warranty that didn't come from Uncle Sam. Getting warranty service is tough enough without government helping.

Apr 07 04:54 PM