25 PERCENT IMPORT TRUCK TARIFF MUST GO, AIADA TESTIFIES Testifying before the United States International Trade Commission on June 15, AIADA called for the elimination of the 25 percent import truck tariff on the grounds that it represents a significant trade barrier to pickup truck imports and that consumers would benefit from greater competition in the light truck segment. David F. Mungenast, Sr., immediate past chairman of AIADA and president of the Dave Mungenast Automotive Family in St. Louis, testified on behalf of the association: "Originally imposed as retaliation against West German's poultry practices, the 25 percent import truck tariff has evolved into a permanent trade barrier. What was intended to be a temporary tariff has been on the books for more than 35 years. Today, because of the punitive nature of the 25 percent import truck tariff, no light-duty pickup trucks are imported into the U.S." In 1998, three of America's top five selling vehicles were pickup trucks, Mungenast pointed out, noting that the light truck segment, including pickups, is the fastest growing segment of the automotive marketplace. "However, in the light truck segment competition is hindered because of the punitive 25 percent truck tariff. Reducing the tariff will increase competition and provide America's consumers with a greater selection of trucks." Mungenast also testified that there is no compelling reason to maintain the 25 percent truck tariff: The U.S. and Europe long ago resolved their dispute over frozen chickens and all other targeted products have had their tariff rates reduced to the original rate. Domestic automakers do not need protection, they own 90 percent of the pickup truck market in the U.S. Reducing the tariff won't reduce government revenues. Since no pickup trucks are now being imported, the U.S. Customs Service doesn't collect any revenue as a result. In closing, Mungenast urged the Commission to recommend to the Administration that the 25 percent truck tariff be among the tariff items discussed at the World Trade Organization's Third Ministerial Conference, which will begin in November in Seattle. Watch your mail for the June/July AIADA's SHOWROOM magazine for a compete primer on the Chicken Tax, one of AIADA's top issues for 1999.

JUNE 1999 All the latest news and information for and about the international automobile industry in America. "Reducing the 25 percent import truck tariff will increase competition and provide America's consumers with a greater selection of trucks." -- Former AIADA Chairman David F. Mungenast, Sr. AIADA 99 Canal Center Plaza Suite 500 Alexandria, VA 22314 703-519-7800 703-519-7810 FAX GOAIADA@aiada.org

AIADA wants the 25 percent import truck tariff (or Chicken Tax) added to the agenda items to be discussed at the WTO meetings. "The U.S. Alliance for Trade Expansion gives us a strong, unified voice for trade leadership, and our participation can only help further the cause of free trade and the elimination of punitive tariffs like the 25 percent import truck tariff," says AIADA's Scott Lane, vice president for government relations.

As an organization dedicated to free trade, AIADA works to increase public awareness of the value of free trade and an open automotive market in the United States.

The Japan Automobile Manufacturers Association (JAMA) says that performing below the market doesn't reflect a lack of access, pointing to DaimlerChrysler as a case in point. Sales in Japan of its Chrysler cars fell 36.9 percent last year, and are down 23.7 percent this year so far. But on the Daimler side, Mercedes sales were down only 5.2 percent last year and are up 15.7 percent for the first three months of 1999. "Can regulations and market access issues really hurt one half of the company and not the other?" asks JAMA's William Duncan.