Consumer Car Buying Advice Blog

Bad credit car loan shoppers who are in the market for a vehicle with the most North American content may want to check out the portion of the Monroney label dealing with the American Automobile Labeling Act.

A very quick history

Back in the 1950’s, it was easy to tell a domestic car from an imported one. At least a few of us here at Auto Credit Express remember the time when a Pontiac was built in Pontiac, Michigan, Buicks were built in Flint, Michigan and Oldsmobiles were assembled in Lansing, Michigan.

There were, of course, other assembly operations spread throughout the United States. The aforementioned cities, however, were the home operations for these divisions and, in any case, they were all built here in the U.S.

There were some imported cars, but they really occupied the fringes of the automotive market with the German Volkswagen being the most obvious “foreign” car.

What is the AALA?

But beginning sometime in the early 70’s, imported cars began to capture a growing share of the market. As these vehicles gained market share, many of the companies that produced them established assembly facilities here in the U.S. both as a hedge against currency fluctuations and to counter the very real reality that they were stealing jobs away from American workers.

At the same time, the domestic automakers, in an attempt to level the playing field in terms of wages, moved some of their production (for both vehicles and parts) to Mexico as well as to overseas plants.

Due to this blending of sources for both parts and production, the American Automobile Labeling Act of 1994 (for all vehicles assembled after October 1, 1994) was created to show new car shoppers now only the country of assembly for the vehicle, but also the percentage value of U.S./Canadian content of parts as well as the countries of origin of the engine and transmission.

AALA information

According to the act, each new passenger motor vehicle must be labeled with the following items of information:

• The percentage U.S./Canadian equipment (parts) content;

• The names of any countries other than the U.S. and Canada which individually contribute 15 percent or more of the equipment content, and the percentage content for each such country (a maximum of two countries);

• The final assembly point by city and state (where appropriate), and country;

• The country of origin of the engine;

• The country of origin of the transmission; and

• A statement which explains that parts content does not include final assembly (except the engine and transmission), distribution, or other non-parts costs.

One more thing to remember: the percentage U.S./Canada equipment content, as well as content percentages for other countries are calculated on a “carline” basis rather than for each individual vehicle and may be rounded to the nearest 5 percent. The term “carline” refers to a name of a group of vehicles which has a degree of commonality in construction, e.g., body and chassis (in this instance, a Ford Focus would be a separate “carline” from, say, a Ford Fusion).

These “carline” estimates are also made before the beginning of a model year based on a manufacturer’s best production estimates for the number of base versus high-line models as well as transmission and other option mixes.

The Bottom Line

For those bad credit car loan buyers who are looking to support the domestic auto industry, or who wish to know the source of content of a vehicle before they begin the loan process, the National Highway Traffic Safety Association (NHTSA) publishes an annual list of vehicles that is available on their web site at: www.nhtsa.gov.

For more information of bad credit car loans, please visit our site at www.autocreditexpress.com.

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