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The Most American-Made Car: Soon to Be Tesla Motors Inc.’s Model S?

Ford (NYSE: F  ) retained its bragging rights this year on's just-released annual list of the top American-made cars. The F-150 ranked first, thanks to continued strong sales and domestic-parts sourcing. But one new American automaker soon may be poised to become more red, white, and blue than any other manufacturer in the world: electric-car maker Tesla Motors (NASDAQ: TSLA  ) .

Tesla's Fremont factory in California. Image source: Tesla Motors.

Bragging rights that matter
In a country that values domestic pride, "American-made" often serves as a marketing tool. But what if Ford lost this bragging right to Tesla? Would it be yet another sign that Tesla is destined to play a big role in the U.S.?

There's no doubt about it: Once Tesla's Gigafactory is built, Tesla's once small operation will have officially transitioned to an American-made auto empire. Tesla's planned Gigafactory is no small undertaking. The $5 billion project has multiple states vying for it. Texas Gov. Rick Perry was even driving around in California in a Tesla Model S while making his intentions clear on Twitter: Texas wants Tesla's Gigafactory.

The Gigafactory, which Tesla says will build lithium-ion batteries at a scale of 500,000 vehicles by 2020, will employ approximately 6,500 people, the company says. In addition to Tesla's Gigafactory, the company is making its mark on U.S. soil by rapidly expanding its Tesla-branded Supercharging stations.

Then, of course, there is Tesla's Fremont factory, which the company says won't be maxed out until it hits production levels of 500,000 cars per year.

Tesla's planned Supercharger locations by 2015. The locations above will put a station within Tesla driving range of 98% of the U.S. population. Image source: Tesla Motors.

Morgan Stanley analyst Adam Jonas is already calling Tesla "the most important car company in the world." If Tesla's vehicles became the most American-made, it could be a more meaningful marketing tool for the much smaller Tesla than it is for Ford.

Unlike Ford, Tesla relies almost completely on the media and word-of-mouth marketing to generate awareness about its vehicles. It pays for no advertising, and offers no promotions. Getting the top American-made title would be just one more bragging right Tesla could add to its long list of accolades to help generate buzz.

More American-made than the F150?
Today, Tesla claims that its electric sedan has about 55% American- and Canadian-made content. But the vehicle is about to get an American-made boost.

Model S. Image source: Tesla Motors.

After the Gigafactory is built, and thanks to Tesla's proposed efforts to source Gigafactory materials from the U.S., about 90% of Model S content could come from the U.S -- a figure that would beat out any other vehicle sold in the Land of the Free.

Fortunately, for both consumers and Tesla investors, Tesla's American-made cars will be available at more affordable prices by then. In conjunction with the Gigafactory, Tesla is planning to bring to market a fully electric vehicle with a starting price around $35,000. This more-affordable Tesla will put the automaker in a whole different ballgame.

Tesla CEO Elon Musk has said that the more-affordable Tesla will be slightly smaller than the Model S, and have a range of more than 200 miles. The planned time stamp on both the Gigafactory battery production ramp, and the launch of the more affordable Tesla, is 2017.

If Ford doesn't find a way to source more parts in the U.S., Tesla may soon make the most American-made vehicles.

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A major technological shift is happening in the automotive industry. Most people are skeptical about its impact. Warren Buffett isn't one of them. He recently called it a "real threat" to one of his favorite businesses. An executive at Ford called the technology "fantastic." The beauty for investors is that there's an easy way to invest in this megatrend. Click here to access our exclusive report on this stock.

Read/Post Comments (6) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 04, 2014, at 6:16 PM, StanO6 wrote:

    @DanielSparks, this is a good point, thank you.


    Happy Birthday, America!

  • Report this Comment On July 04, 2014, at 8:00 PM, sabebrush6 wrote:

    Percentage wise, the Elio could beat out Tesla for being the most American made car in America.

  • Report this Comment On July 04, 2014, at 10:27 PM, phillipzx3 wrote:

    "The only way to make this car faster is to make it in Texas. cc:"

    The way to ruin Tesla's reputation would be Perry having any part in it.

    Ironic that "red" states would so interested in a car they so hate.

  • Report this Comment On July 05, 2014, at 3:22 AM, Roddy6667 wrote:

    There's an elephant in the room everybody is ignoring. Tesla has been in business since 2003 and has never made one dollar of profit using real-world accounting (GAAP). It is a circus existing on government subsidies and stock sales to wide-eyed fanboyz.

  • Report this Comment On July 05, 2014, at 12:31 PM, NavyChum wrote:

    Roddy - right. And there are camps who are getting stung by Tesla's great success: Big Oil, dealerships, shorts, and terrorists. Which group are you in?

  • Report this Comment On July 05, 2014, at 9:17 PM, Roddy6667 wrote:

    Wow! You really drank the Kool-Aid! He hurt Big Oil? Not one percent of one percent. And "terrorists"????? WTF. Tesla is a niche company that makes an expensive toy for rich trendoids who will be salivating over some other shiny object next year. He has done nothing. All I hear about is what he is GOING to do.

    I'm not in any of those groups. I live in a large city that has excellent public transportation and I don't own a car. I'm just the kid who is pointing out that the emperor has no clothes.

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Daniel Sparks

Daniel is a senior technology specialist at The Motley Fool. To get the inside scoop on his coverage of technology companies, follow him on Twitter.

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