When Volkswagen of America CEO Stefan Jacoby announced that his company would be building its assembly plant in Chattanooga, the roar from the crowd was so loud he simply said, “Wow.”
Now banners line the city’s streets saying “Willkommen Volkswagen,” welcoming the company in its home language of German.
That type of reception represents a big shift in thinking from the 1980s, when the “buy American” movement was in full swing in response to Japanese automakers entering the U.S. market, said Dr. Matt Murray, associate director of the University of Tennessee’s Center for Business and Economic Research.
“I just think back to 25, 30 years ago, and there was this strong ‘buy American’ case being made,” he said. “I think it’s been an entire sea change.”
A global economy, the North American Free Trade Agreement and the Internet are factors in that change, Dr. Murray said. Still, “hard, tangible evidence” of that shift may be hard to come by, he added.
But survey data show that people have warmed up to foreign-made cars over the years.
A 2006 CBS News poll reported that 71 percent of Americans preferred to buy American cars in 1988. That number dropped to 51 percent by 2006, according to the poll.
Over the same time period, the percentage who wanted to buy Japanese cars jumped from 16 percent to 30 percent and the number who would buy a German car went from 7 percent to 8 percent, the poll said.
Phillip Rogers, a Harrison resident who lives near the Enterprise South site where the new VW plant is being built, said he’s more worried about the traffic that will come when the plant opens than the fact that the company is German.
“Foreign companies have pretty well established themselves in this country,” he said. “They provide a lot of jobs.”
Mr. Rogers said he drives a car made by a foreign company — a Toyota Prius — because he thinks it’s a higher-quality car than a Ford or one from General Motors. He said he bought a Chrysler in 1989, but was dissatisfied with it.
Roger Simmermaker, author of the book “How Americans Can Buy American,” said Americans’ change in thinking about foreign-made goods developed because people are more familiar with the products.
“Once something is around for 25 years, it tends to blend in,” he said.
Local officials and residents are excited about the coming VW plant because they “are looking at this in the short term,” Mr. Simmermaker said. He pointed out that profits from American-made Volkswagens ultimately go back to Germany, so buying a Volkswagen because a family member might work at the plant would be “helping Uncle Bob, but hurting Uncle Sam.”
But Dr. Murray said local businesses and workers could benefit from the advent of the VW plant and the jobs it brings.
“That’s why they embrace it,” he said.
Another advocate for American-made goods said the VW plant would be beneficial because it’s creating American jobs.
“Too many American consumers have the mistaken idea that buying Ford, GM or Chrysler is the same as buying American,” said Phil Haming of the Web site ionlybuyamerican.com. “The fact is that these are international companies with stockholders all over the world.”
Mr. Haming noted that GM makes its Chevrolet Aveo in South Korea, for instance.
Still, the location of a plant probably does make a difference in public perception, Dr. Murray said.
“The people in the Chattanooga community realize they can benefit economically from the presence of it and so they’re more willing to embrace it,” he said.
Amy Agee, of Hixson, said she thinks Americans should buy American-made goods but also believes a foreign company bringing jobs to the United States is a good thing.
“I have no negative feelings about (Volkswagen) coming at all,” she said.
Another factor in the diminishing trend of “buy American” may be that foreign companies like VW probably weren’t looking to build a plant in the United States until about 25 years ago, Dr. Murray said.
“These companies realized in the late ’70s and the early 1980s that they could mitigate the ire of the American worker and voter by making the investment here,” he said.
Likewise, the company could save money on the cost of shipping automobiles from overseas to the States, he said.
Hamilton County Mayor Claude Ramsey said the idea of a foreign company coming to the Enterprise South never bothered him during the 14 years or so local officials sought a tenant for the site.
“If it was built in Hamilton County, Tennessee, it was made in America,” he said.
Mr. Ramsey said he doesn’t believe people should have a problem with the highest-level VW executives working from offices in Germany.
“I think it’s very well accepted,” he said. “It’s common practice.”
Still, Mr. Simmermaker warned that Volkswagens made in Chattanooga may not entirely be made of parts made in America, even if the cars are assembled here.
“We’re throwing our support to a foreign company that has a very low domestic parts content,” he said.
About 17 percent of the parts of a hard-top VW Beetle made in Mexico are made in the United States and Canada, said Ron Kwiatkowski, sales manager at Village Volkswagen in Chattanooga.
Engines for the VW cars assembled here will be made at the company’s Mexico plant, according to VW officials.
According to an April report titled “Who Really Made Your Car?” in the journal Employment Research an increasing number of parts used in U.S. manufacturing plants come from foreign countries.
“In reality, a large share of imports arriving at U.S. final assembly plants actually consists of engines and transmissions made by highly skilled workers in wealthy countries like Canada and Japan,” the report states.
The amount of U.S.-made content in cars must be disclosed on stickers in cars, according to the Federal Trade Commission. For a company to make an unqualified claim that a car is made in the United States, it must have “no — or negligible — foreign content,” according to the FTC Web site. A manufacturer can qualify the claim to say, “Made in USA of U.S. and imported parts.”