I guess free trade ain't free, after all.
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Federal trade agency proposes higher import fees on certain motorcycles
- Thread starter mcrider
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Meriden
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[ insert long discussion of WTO and feed lot economics here...] Let's just say we'll run out of hot dogs long before we run out of food. Cornell
As for the selection of this class of motorcycles, my best guess for the cause is two things: carousel retaliation and size of market. Carousel retaliation allows us to penalize countries in products other than the ones in question. The size of the under 500 cc motorcycle market is likely going to help total the 116.8 billion losses we are due per the WTO.
Main thing we need to do is address the request for public comment. The links are listed in other posts.
m
This is about slowing the loss of non service US jobs, the kind we have been losing out on for years. In this case, beef sales to the EU. Here the EU has banned US beef and the US took it to the WTO and won its case in 1997. Since then it has been tied up in appeals.
The best answer for me is to label the beef and let the EU folks decide whether to buy it or not. Instead, it's banned.
The US exports are anemic compared to imports. Ag products is one of the few we do extremely well exporting. We need to keep as much of that as we can but perhaps a better way would be to stop using the bovine hormones but I am not a cattle expert despite having cattle much of my life.
The 50 to 500cc class is where I am seeing a lot of new rides I like. But I can't imagine more than a $100 buck tariff on them and doubling it to $200 is not that much. Does anyone know the current tariff structure on small bikes?
Long term I think both political parties are going to address this problem of America morphing into a service only job sector. They have to given the last election. All nations are in debt up to and way beyond anything in history. They are fighting for every scrap. It's going to get ugly.
The best answer for me is to label the beef and let the EU folks decide whether to buy it or not. Instead, it's banned.
The US exports are anemic compared to imports. Ag products is one of the few we do extremely well exporting. We need to keep as much of that as we can but perhaps a better way would be to stop using the bovine hormones but I am not a cattle expert despite having cattle much of my life.
The 50 to 500cc class is where I am seeing a lot of new rides I like. But I can't imagine more than a $100 buck tariff on them and doubling it to $200 is not that much. Does anyone know the current tariff structure on small bikes?
Long term I think both political parties are going to address this problem of America morphing into a service only job sector. They have to given the last election. All nations are in debt up to and way beyond anything in history. They are fighting for every scrap. It's going to get ugly.
tshelfer
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Never has been, really. Free trade is an ideal, but practically speaking, more or less an impossibility given government interventions and the inequality of the competing economies involved.
I'm not a rancher or farmer, so I can't even pretend to understand the total economics. What I do know is that, historically, the US has written the rules. Everybody has something to sell us and we get to decide what standards it (bikes, automobiles, Teddy Ruxpins) has to meet before we'll accept it. And that's totally reasonable.
We've also been accused, over the years, of not reacting well to the import restrictions, or sometimes just plain realities, of other nations. Like us, they have their legal standards as well as their likes, dislikes, and quirks. If you want to sell ag in Europe, you have to sell them what they want to buy, and you have to grow it to EU standards.
Valker
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Most, if not all, of the European big automakers have factories in the US. BMWs are made in the Carolinas. I know the Japanese car companies manufacture almost all of their US cars inside the US.
I am well aware of this. Which makes Trump's tweets look even more ham fisted.
woodsguy
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His tweets were his attempt to get more Chevys sold in Germany. That would be a good thing. That he tweets instead of using the press conferences is because tweets go right to the people instead of through the filter of the MSM. Both these are why he was elected.
I could go on but wouldn't it be best under the OT since the thread morphed away from motorcycle tariffs?
I could go on but wouldn't it be best under the OT since the thread morphed away from motorcycle tariffs?
ShafT
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You're right that the GS won't double in price due to displacement, but I'm not sure that it is only the tariff that doubles. The public notice states, "Pursuant to that authorization, USTR announced a list of EU products that would be subject to a 100 percent rate of duty." The current request is to reinstate that 1999 100% duty on select products. It seems like a Husky or KTM 450 would be close to double current dealer cost. If true, it would cripple a single line dealer, like a KTM dealer, who sells mostly off-road vehicles.
Good news is that it is not a foregone conclusion that motorcycles are included. They will be gathering a total of $116.8 million in annual impact from the products on the list. The USTR specifically stated it is "particularly interested in comments addressed to the possible effects of reinstatement on U.S. consumers and small- or medium-sized businesses." Dealers of these Euro models should fit that audience for whom the USTR has expressed specific concern and they can make their case with thoughtful commentary.
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Meriden
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This is correct. Tariffs are levied as a percentage of the import value or as a specific tax per unit of import. As my old econ textbook points out: "Like any other tax, it becomes government revenue. Although US importers pay the tariff to the U.S. customs... they typically shift at least part of it onto the consumer by raising prices." I'm not sure how much margin is in the struggling powersports industry today, but I bet we're going to take the brunt of this new tax.
I tested the import tariff on a mock KTM using an import calculator. Between Austria and the US, the duty was $25 on a $5000 wholesale motorcycle using today's duties and tariffs model for a MFN. The tariff is $0 so doubling it would only result in $0.
The other news, whether good or bad, is that this is a punitive measure, not protectionist as it is typically understood of this kind of tax. This tax will not make the US more competitive since we have no competitive industry in the market. As a punitive measure, carousel retaliation requires that the products on the list be shifted every 180 days. One might imagine that the import of small CC motorcycles from the EU will be adjusted to take advantage of windows where the tax is lowest. This would only raise the total cost by the amount needed to carry inventory. (Yea, business geeks, I know it ain't that simple...) On the other hand if the demand is not there from the consumer the product just will just go away. There are not a lot of small trucks out there because of the famed 25% chicken tariff er, um tax.
So anytime someone mentions a "tariff", just think "tax" and ask if you feel it is reasonable. If not write the trade regulators at the links earlier in this and the "Any Info?" thread.
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