silvrsvt Posted April 1, 2013 Share Posted April 1, 2013 Saw this nugget mentioned on Japlonik about Hyundai doing a pickup: The accord stipulates that the U.S. tariff of 25 percent on imported light-duty trucks and vans, the so-called chicken tax, will remain in place for seven years, then be phased out by 2021. Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20130401/OEM03/304019965/hyundai-exec-were-studying-pickup-for-u-s#ixzz2PEYgr5zq Follow us: @Automotive_News on Twitter | AutoNews on Facebook Quote Link to comment Share on other sites More sharing options...
aneekr Posted April 1, 2013 Share Posted April 1, 2013 Good find, silvrsvt! Phase out of the U.S. 25% tariff on imported light trucks comes about 50 years too late, but better late than never I suppose. Quote Link to comment Share on other sites More sharing options...
bzcat Posted April 1, 2013 Share Posted April 1, 2013 Good find, silvrsvt! Phase out of the U.S. 25% tariff on imported light trucks comes about 50 years too late, but better late than never I suppose. It's not being repealed. It's just being exempted (on a 7-year time table) on trucks imported from Korea as part of the US-Korea free trade agreement. There has been a multi-front effort by Ford and GM to repeal chicken tax when it suits them and stop the tax when it doesn't suit them. The 7-year phase out was a compromise because Ford and GM won't stand to benefit from the repeal. GM could potentially benefit if it moved truck production to Korea but it's probably not going to so that. GM pushed for chicken tax elimination as part of the US-Australia free trade agreement with no phase out period. GM was on track to import the Holden Ute as Pontiac G8 ST before Pontiac was axed. Ford was a big proponent of US-Thailand free trade agreement that would have eliminated chicken tax, also without phase out period. But the Thai Govt didn't completed the negotiation (the military coup put an end to the discussion and it never restarted). I have speculated before that this is the true reason why Ford couldn't sell the T6 Ranger in the US... it had planned to import the truck from Thailand but Ford didn't count on the military coup to happen. The timing was too perfect to be a mere coincidence... They announced closing of Twin Cities Ranger assembly plant almost 4 years ahead of time while assuming the free trade agreement would be ratified. Quote Link to comment Share on other sites More sharing options...
aneekr Posted April 1, 2013 Share Posted April 1, 2013 Thanks for the additional details bzcat. Do you know if there are plans resume talks about a U.S. - Thailand FTA, or establish a broader U.S. - ASEAN FTA by mid decade? Quote Link to comment Share on other sites More sharing options...
jpd80 Posted April 1, 2013 Share Posted April 1, 2013 GM pushed for chicken tax elimination as part of the US-Australia free trade agreement with no phase out period. GM was on track to import the Holden Ute as Pontiac G8 ST before Pontiac was axed. Ford was a big proponent of US-Thailand free trade agreement that would have eliminated chicken tax, also without phase out period. But the Thai Govt didn't completed the negotiation (the military coup put an end to the discussion and it never restarted). I have speculated before that this is the true reason why Ford couldn't sell the T6 Ranger in the US... it had planned to import the truck from Thailand but Ford didn't count on the military coup to happen. The timing was too perfect to be a mere coincidence... They announced closing of Twin Cities Ranger assembly plant almost 4 years ahead of time while assuming the free trade agreement would be ratified. Importing from Thailand would have helped Ford, GM and Toyota who all build their mid sized trucks there. No doubt the 2006 coup sealed the fate of T6 Ranger but sources tell me that Ford NA had already walked away... Quote Link to comment Share on other sites More sharing options...
bzcat Posted April 2, 2013 Share Posted April 2, 2013 (edited) Thanks for the additional details bzcat. Do you know if there are plans resume talks about a U.S. - Thailand FTA, or establish a broader U.S. - ASEAN FTA by mid decade? I don't know for sure but I can speculate based on what makes sense for US and foreign car companies. US-EU FTA will almost certainly remove all tariffs on autos including chicken tax. Ford and GM will gain manufacturing flexibility on both sides while VW will surely re-enter commercial vehicle market in the US with chicken tax removed. US-Japan FTA will almost certainly not remove chicken tax, at least not without some long phase out period. There is no mutually beneficial outcome that will enable both sides to negotiate on this. None of the Japanese companies still make pickup trucks in Japan and their vans are not suitable for US market. US-ASEAN will probably remove chicken tax. Ford and GM are vested in vehicle (particularly truck) production in Thailand. The Japanese companies will stand to benefit the most (as is the case with US-Korea FTA) but they have powerful lobby in Washington too. Edited April 2, 2013 by bzcat Quote Link to comment Share on other sites More sharing options...
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