Honda’s Accord May Soon Qualify as an American Car
The Honda Accord, the first Japanese model to become the best-selling car in America, may soon set another precedent by becoming the first Japanese car to be officially designated an American model by the U.S. government.
Honda officials said the 1991 Accords built in the company’s Marysville, Ohio, assembly plant starting next fall are expected to have more than 75% American content--which means that at least three-quarters of the parts and labor used to build them will come from the United States.
“We are ready to hit 75% in 1991,” Honda spokesman Roger Lambert said Monday.
That would give the Accord the highest American content of any car built in the eight new U.S. assembly plants run by Japanese auto makers. And it would mean that next year’s Accord could qualify as an “American” car under domestic content standards established by the Environmental Protection Agency, which monitors the fuel economy of each model sold in this country.
The EPA sets the government’s only domestic content standards for automobiles, and thus provides the only official sanction as to whether cars built in the United States by foreign auto makers can be technically considered domestic products.
All of the major Japanese auto makers now build cars in this country, but none have previously qualified for the EPA’s domestic ranking because they use too many Japanese parts. They are thus officially designated as imports when the EPA compiles its annual mileage ratings.
But Honda has gone much farther than any of the other Japanese firms in turning its “transplant” assembly operation into a genuinely American manufacturing complex.
The company operates two U.S. auto assembly plants--the second one just opened in East Liberty, Ohio--and has the capacity to produce more than 500,000 Accord and Civic models a year in this country. It also has built a massive new engine and transmission manufacturing center in Anna, Ohio, and is in the process of expanding its engineering offices so that it can develop and engineer new cars in the United States, as well.
Honda has more than 9,000 employees in its U.S. manufacturing operations, making it the largest private employer in central Ohio.
For 1990, Honda officials say the company’s cars assembled in Ohio carry an average American content of 72%. The Accords built there will rise to 75% next year, they say, while the Ohio-built Civics will reach the 75% level in 1992.
Still, Honda officials say they haven’t decided yet whether to ask the federal government to count the 1991 Accord as a domestic. Lambert said the company first wants to study what the impact of such a move would be on the firm’s fleetwide fuel economy average.
“What this (reaching 75% domestic content) means for our (fuel economy ratings) we don’t know yet,” said Lambert. “The important thing is that we are continuing to increase our local content.”
Tom Ball, head of the EPA’s mileage certification laboratory in Ann Arbor, Mich., said the agency generally gives the auto makers wide latitude in deciding whether to classify a new car as a domestic or an import.
“They keep the records (on domestic content levels), and we can check them if we want to,” Ball said. “But it’s pretty much up to the company to follow the rules.”
The EPA measures domestic content because, by law, it is required to calculate separate mileage averages for each auto maker--one average for all of the imported cars sold by that company, and a second one for all of the domestic cars that the firm sells. Still, both the import fleet and the domestic fleet of each company must meet the same mileage standard--an average of 27.5 miles per gallon.
BACKGROUND
Honda opened its first U.S. auto assembly plant in Marysville, Ohio, in 1982 and began production at its second U.S. assembly plant in nearby East Liberty, Ohio, in 1989. Now the company employs 9,000 workers in Ohio operations, producing Accord and Civic models, as well as engines, transmissions and motorcycles. The two plants combined produce more than half a million cars a year and provide the majority of the Accords and virtually all of the four-door Civic models sold in the United States.
