Many unscrupulous companies are taking advantage of consumers by passing off foreign goods as “Made in the USA”
Words: Jeff Honeycutt
“MADE IN THE USA.” If you are a patriotic United States citizen, this is most likely an important phrase to you, and finding this label on a particular product may even influence your purchasing decisions.
After all, buying goods that are made in the United States is the best way we can guarantee jobs will also remain here. Of course, it is easy to talk the talk, but when money is tight and you can save a significant portion by not worrying about where something is made, that decision becomes quite a bit tougher.
Let’s just be honest here, it is especially true for hot rodders and racers, because the money spent on these pursuits is quite often discretionary income. In other words, money for the car comes from whatever is left over after the house payment is made, the groceries are purchased, and the credit card companies have been given enough to keep them off your back for another month. So you have to bargain shop, right?
Consumer Reports magazine did some research in 2013 and the findings sound quite similar. The Consumer Reports National Research Center found that 78 percent of Americans (citizens of the United States of America) said they would rather buy an American product versus something made overseas.
Of that 78 percent, more than 80 percent said their reason was mainly to help keep manufacturing jobs in the country.
More than 60 percent said they would buy American made clothes and appliances even if the cost is 10 percent higher than an imported version. But here’s the rub, if the difference rose to 20 percent, that number dropped to just 25 percent of Americans willing to pay the difference.
By that math, 75 percent of Americans would drop their “Made in the USA” pride and go for a $12.50 foreign-made thermostat, while only 25 percent of Americans would be willing to pay 20 percent more ($15 total) for an American-made one.
75 percent of Americans would drop their “Made in the USA” pride and go for a $12.50 foreign-made thermostat, while only 25 percent of Americans would be willing to pay 20 percent more ($15 total) for an American-made one.
And it gets worse. Many unethical companies use shady techniques to get consumers to think they are buying American when they are not.
Consumer Reports cited a company out of Mexico printing shirts with words “Made in the” with an American flag below it. You and I would almost certainly think that means the product is made in the USA, but it doesn’t actually violate Federal Trade Commission regulations.
Fortunately, automobiles and auto parts — along with textiles, wool, and fur — must have a Made in the USA label if the majority of production is done in the USA. Otherwise, they must carry a label for the country of origin. But unethical companies still try to game the system.
We’ve seen foreign-based companies use a logo that looks similar to something that screams USA, like an eagle carrying a red, white, and blue shield. Some companies will even simply rip off a trusted American company’s logo and counterfeit its product.
We recently spoke with Vic Wood, the Vice President and GM of Aeromotive, who told us of the company’s efforts to fight counterfeiters.
“Here at Aeromotive we have been very proactive in protecting our products and our trademark from offshore counterfeit operations,” Wood says. “That has been driven by people who have attempted to copy our products in many cases. They don’t re-engineer it, they ‘de-engineer’ it because they take away much of the quality. And they attempt to put our logo on their product.
“We have gone to enormous lengths to register our logo in China with the Chinese legal system. We have worked very hard on that, and that has not been an inexpensive exercise. We have had companies prosecuted now for copying our products, and we have no hesitation listing them on our website, so that our consumers can look and see what a copy product looks like and who it is coming from.
“We patent all of our stuff whenever we can, so that we have some kind of patent protection as well,” Wood adds. “A great example is at last year’s SEMA show we found copy product in the show. So we worked through the SEMA legal system, which was fantastic.
“We had enormous support from SEMA and their legal team at the show, and we had the people in the show served with legal paperwork. We had the product removed from the show and we followed that all the way through to the courts and achieved a prosecution on those people located in China. We are very proactive in sticking up for ourselves.
“You’ve got to be alert for counterfeit product and you’ve got to be prepared to stand up. I have seen numerous companies say, ‘Well, we don’t know what to do about it. We don’t know how to work with the system.’ There are ways and means to do it, but you’ve got to be prepared to step up and go for it. I think the more of us that do, the better off we are going to be. There are legal systems available, but you have to be committed to chase it. And unfortunately, you’ve also got to be prepared to spend the money.”
One tactic some companies will take is instead of trying to copy a product logo, they will simply copy an existing product and sell it under its own brand name. This eliminates the cost of any engineering or even research and development. By manufacturing the product in China or some other country, they can cut costs even further. But this often comes at the expense of quality.
“The biggest thing with going to places like China is they just go buy a part. They take it over there and set it on somebody’s desk — more often than not, they don’t even take it, they just ship it — and say ‘Hey, make me some of these,’” says COMP Cams’ Chief of Operations, Scooter Brothers. “And they have no development, no research, and no blueprints — none of that stuff involved in creating a product.
“Yes, you can reverse engineer some products like that, but all you have are measurements,” Brothers adds. “You don’t know the metallurgy, or why a certain alloy was used. You don’t know specifics on the machining process. And more often than not, these guys don’t care anyway.
“So then they ship it back over here, and they sell totally on price, and what we have to do is make sure that people understand that it isn’t the same. It might look the same, and it may bolt up and work at first, but it probably won’t work as well, and it probably won’t last as long either.”
Brothers points out that an often overlooked consequence of copycat products produced overseas is that it lowers the perceived value of goods engineered and produced in the United States.
If consumers are continuously duped by knockoff imports with lower prices, they don’t have the experience to know just what they are missing out on.
When a product is well-engineered, manufactured to tight tolerances, and checked over by a scrupulous quality control department, the outcome is better results all around.
Examples of those better results include bolt-ons that actually bolt on without having to drag out the band saw and welder, a knowledgeable tech support department that can actually answer questions and assist with the install, and performance that meets the expectations, durability, and even a warranty.
All these ancillary benefits costs money, but U.S.-based companies are willing to invest in these services and features, because the companies won’t last long if they don’t.
Offshore companies building copycat product are known to make returns incredibly difficult, or even impossible. From what we understand, the typical thinking on their end is that by the time consumers realize their “too good to be true” cheap product isn’t any good, they will have moved on to make something else.
“Quality of materials is an area where these knockoff products can really hurt the consumer,” Brothers explains. “They are missing out on that side, because they don’t know. Anybody that has ever been over to any of the Asian countries — excluding Taiwan and Japan, which have pretty much gotten past this — will see that the prevailing thought is ‘Good enough is OK.’
That is the thinking dimensionally, metallurgically, cosmetically — everything is OK as long as it looks good and it will perform. But it doesn’t have to perform well for very long.
“From my experience many of these places have serious issues with metallurgy. They have serious issues with heat treat. And not all the time, but quite often, they have issues in manufacturing with the quality of machine work.
“Now some of them are getting up to speed on that, but it is still the fact of the matter that when a U.S. company goes over there and says, ‘I want a wheel bearing, and I want to pay a dollar for it,’ then they are going to get a dollar’s worth of wheel bearing. What they will get is something that will look like a bearing, and will install like a wheel bearing, but will it last? Will it perform properly? Will it do all the other things that you need from it? Probably not.”
Brothers says that the solution that COMP Cams — and all the companies working under the COMP Performance Group umbrella — have come up with, is to innovate faster than they can be copied.
“I don’t worry too much about the short-term, but I do worry about the long-term benefits,”Brothers says. “That’s what we have to be careful of. Companies like ours just have to move faster than [the copycats] can move. The way that they do it is just go buy one of my products, then go somewhere and have it knocked off.
“The very best they can do is be about a year behind. So if I move fast enough, they are only going to copy what I used to have. That’s the biggest advantage you got as a manufacturer.
“So the best they can do is be second. Now if that is good enough — being second in time, second in performance, and second in quality — if that is good enough for the consumer, if he makes the conscious decision that he’s willing to sacrifice those things, then he should buy the cheaper one.
“But I will suggest to you that most people in our industry are not going to make that decision.”
Of course, this is a world economy that we live in. The manufacturers based in the United States often have to source pieces for their products that come from other countries. Just take Ford and General Motors for example, both have invested heavily in plants to continue production of most of their vehicles right here in the United States. But both also source products that go into their vehicles from companies that produce in other countries. Not knockoff products, mind you, but products that meet their engineering specs.
Any company that hopes to produce a quality product at a competitive price must look for every option, and sometimes working with a foreign manufacturer is an ethical answer. Brothers notes that RHS uses a foundry in China for one of its cylinder head castings.
“Probably one of the best aluminum casting houses I’ve ever seen,” Brothers explains. “They do 250,000 cylinder heads a month, and almost all of them are staying in China as OE cylinder heads. We get ours from there not for the price, but for the quality of the castings.
“The price of aluminum is a commodity price on the materials, and that doesn’t change. Then you’ve got the aggravation with the freight, the shipping time, and all the other stuff that you have got to factor in. However, sometimes you just have to go to whoever is the best at making what you need.
“But they are horrible at machining the heads. So we have them just do a quick machine to cube them off before they send them over here, and we do the rest of it here in the United States.”
So what can we as consumers do? How do we balance value to make sure we are getting the best on both price and performance?
Both Wood and Brothers encourage their customers, both current and potential, to do their homework.
If being second in time, second in performance, and second in quality is good enough for the consumer, if he makes the conscious decision that he’s willing to sacrifice those things, then he should buy the cheaper one.
Brothers points out that ethical motorsports and performance automotive companies operating in the United States aren’t trying to gouge consumers. But research and development, engineering, product testing, a tech support staff manning the phone banks, and even warranty repairs and exchanges cost money.
Still, if you look around, similar products from similar companies will sell their products for similar costs. For example, Crane and MSD are both reputable manufacturers of ignition equipment that make quality products, and their prices are in line with each other.
If you see a newcomer come in with an ignition box that looks suspiciously like MSD’s venerable 6AL for less than half the price, you know something is up.
“If you pay peanuts, you get monkeys,” is the colorful phrase Wood uses, but it makes sense.
“We are happy to tell people which companies are Aeromotive official distributors,” Wood adds. “If you want branded product and to make sure you aren’t getting ripped off by a counterfeiter, you need to shop recognized distribution channels. Don’t just by off the Internet from the first guy you come across.
“We’re not talking about the JEGS and the Summits of the world. Those people don’t do it. It’s the guy that sets up an ebay store or a backyard speed shop who gets stuff from who-knows-where and starts throwing it into the market. If people buy that, they usually get a sub-par product with no tech support and no warranty. They are out on their own.”
Wood and Brothers both stress that consumers should consider overall value and not the price.
In other words, if you find a great deal on an engine oil pump, — that’s awesome — but if the pump fails and leaves you with significant engine repairs, was it really such a great deal after all?
Value is getting the right part for the right price and using it to squeeze maximum performance from your hot rod or race car with minimum headache. That may sometimes cost a little more money, but the results are usually worth it.