Impact of Importing Intermediate Automotive Parts

The United States auto industry provides an estimate of 1.6 million jobs across the 50 states and it is the second-largest manufacturing employer. The domestic automakers strive in order to design their vehicles more and more appealing to the consumers. The U.S. auto makers are able to maintain their cost lower and provide quality product by outsourcing most of the vehicle intermediate parts such as tires, batteries, and wheels. The American people and economy are affected by the outcome of the U.S. auto industry when purchasing these intermediate parts from foreign manufacturers. Figure 1.0 – Reflect the amount of imported parts from foreign manufacturers. The United States automotive industry chooses to outsource most of their intermediate parts from foreign manufacturers when building their vehicles. The most important outcome of this practice is that domestic auto makers are able to maintain the final vehicle cost lower for the consumers. By outsourcing the intermediate parts the U.S. auto industry is able to eliminate the overhead cost of manufacturing these parts. If the auto industry where to manufacture their own intermediate parts they would have to increase the cost of their vehicles.
Another important reason why manufacturers outsource the intermediate parts is to be able to provide quality parts to the consumer. The U.S. auto industry is able to focus their efforts towards the building of the vehicle instead of other intermediate components. Manufacturers of the outsourced intermediate parts are specialized in their products which allow them to be able to focus their efforts in the engineering and quality control. When the U.S. auto industry outsources parts from well-known and reputable foreign manufacturers it gives the consumer a piece of mind because they know the auto industry is