AIADA: Protectionists Working Overtime to Preserve Archaic 25 Percent Tariff on Imported Pickup Trucks, Keep Repeal of Truck Tax Out of U.S.-Thai Trade Pact

Washington ¾ The American International Automobile Dealers Association (AIADA) today called on Members of Congress to ensure that repeal of a 25 percent tariff on imported pick-up trucks is not excluded from the U.S.-Thailand Free Trade Agreement, a bilateral trade pact on which formal negotiations are set to begin next week. The tariff, which has been on the books since 1963 and today continues to apply to all imported pick-up trucks, undermines U.S. credibility on free trade policy.

“The tariff on imported pick-up trucks is 10 times the average U.S. tariff on imported passenger cars. As long as this tariff continues to remain on the books, American consumers will have fewer pick-up truck choices,” said AIADA Chairman Buzz Rodland. “What’s really at stake in the U.S.-Thailand Free Trade Agreement is the United States’ international credibility on trade. It’s difficult for Washington to send a message to other nations that we’re committed to free and open trade, while maintaining unreasonably high trade barriers on pick-up trucks.”

The 25 percent tariff on imported pick-up trucks was imposed by President Lyndon Johnson in 1963, as a retaliatory move against Germany for its treatment of U.S. frozen chicken exports. Johnson imposed the tariff because of the direct effect it would have on Volkswagen exports to the U.S. In 2003, only about 400 pick-up trucks were imported into the U.S. -- the majority of which were commercial delivery vehicles.

The U.S.-Thailand Free Trade Agreement is highly significant insofar as the 25 percent truck tariff is concerned because Thailand is the world’s second-largest producer of light trucks. If the tariff were repealed, pick-up trucks produced in Thailand would likely begin to be exported to the U.S. For the most part, the trucks produced in Thailand are sub-compact-type trucks (similar to the Chevy S-10, Ford Ranger, Nissan Frontier and Toyota Tacoma).

“Nothing has done more to lower consumer prices while increasing the quality of vehicles sold in the U.S. than free and open trade. Every automaker -- domestic nameplates and international nameplates alike -- has benefited from competition,” added Rodland. “Repeal of the truck tariff will provide American consumers with expanded choices in low cost, reliable small pick-up trucks -- some of which are priced at or below $10,000. It would provide a boost for hundreds of international nameplate automobile dealers, and it would likely create new jobs.”

About AIADA: Founded in 1970, AIADA represents the 10,000 American automobile dealerships that sell and service international nameplate brands including Acura, Aston Martin, Audi, Bentley, BMW, Ferrari, Honda, Hyundai, Infiniti, Isuzu, Jaguar, Kia, Land Rover, Lexus, Maserati, Maybach, Mazda, Mercedes, MINI, Mitsubishi, Nissan, Porsche, Rolls Royce, Saab, Scion, Subaru, Suzuki, Toyota, Volkswagen and Volvo. These retailers have a positive economic impact both nationally and in the local communities they serve, providing nearly 500,000 American jobs. Visit AIADA online at www.aiada.org.