In a move typical of current short-sighted federal government thinking, the Office of the U.S. Trade Representative-the federal agency responsible for developing and recommending U.S. trade policy to the President-has proposed imposing a 100 percent tariff on all European motorcycles and scooters under 500cc engine displacement as part of a retaliation for the European Union's ongoing import ban on American beef from cattle that have been treated with growth hormones. EU officials haven't lifted the 20-year-old ban despite a World Trade organization order to end it, so the U.S. wants to impose $116.8 million in import duties to equal the amount of money it claims the U.S beef industry loses each year because of the ban.
U.S. trade officials are looking at a list of more than 100 European goods for the possible imposition of 100 percent import duties. Included on the hit list are motorcycles and scooters with engines displacing 51cc to 500cc, representing popular on- and off-highway machines from brands such as Aprilia, Beta, BMW, Fantic, Gas Gas, Husaberg, Husqvarna, KTM, Montesa, Piaggio, Scorpa, Sherco, TM and Vespa.
The AMA issued a statement from Ed Moreland, AMA vice present for government relations, that read, "In this tough recessionary climate, it's ludicrous for the U.S. Trade Representative to even consider imposing a 100 percent motorcycle and scooter tariff, because the move will cost countless Americans their jobs. This very day, the Administration and the U.S. Congress are planning to bail out troubled U.S. automakers to the tune of billions of dollars to save American jobs. How, in good conscience, can the U.S. Trade Representative turn around and propose a measure that will spell the end of many motorcycle and scooter dealerships, and put their employees out in the street?"
"In America, the majority of motorcycles and scooters under 500cc are sold through local dealerships," states Moreland. "Collectively, these dealerships contribute to the employment of a substantial number of Americans working in sales, service, parts and general operations. Unjustified trade sanctions on European-produced motorcycles and scooters will choke off this vital business, dealerships will close at an alarming rate, and the negative effects will spread downstream through the aftermarket and recreational-equipment sectors, and even the motorsports entertainment industry. Countless Americans will find themselves without jobs."
The AMA sent comments to the Office of the U.S. Trade Representative by a Dec. 8 deadline to express the opinions of the Association's 300,000 members on the possible tariffs.
"It is simply unconscionable that motorcycles and scooters are on the list in the first place. They have no place in a trade war over beef," Moreland said. "Furthermore, we find it tragically ironic that, as part of the auto bailout plan, federal lawmakers are considering requirements for American car makers to produce more fuel-efficient vehicles, and yet the motorcycles and scooters that the U.S. trade representative is considering for the 100 percent tariff get three to five times better fuel economy than many cars."
Piaggio Group Americas, Inc. President and CEO Paolo Timoniwhose company will be especially hard-hit, as it imports and distributes Vespa and Piaggio scooters, as well as Aprilia and Moto-Guzzi motorcycles under the 500cc displacement cutoff, made the following statement about the proposed changes to the EU-Beef Hormone dispute sanctions: "We urge USTR not to punish the U.S. employees of a healthy and growing personal transportation company, along with the 400+ U.S. dealers and employees that retail our scooters and small displacement motorcycles, when the only focus of this trade dispute is an agricultural product. We also urge USTR not to punish the American consumer who in rapidly increasing numbers is choosing to add these clean-running, fuel-efficient machines to their transportation fleets in order to reduce U.S. fuel consumption, foreign oil dependence and today's massive congestion and environmental issues. Finally, we urge USTR not to impose measures that would quickly force Piaggio Group Americas and a significant number of its dealers out of business.
"The intricacies of retaliatory tariff measures are not our bailiwick, but serving the thousands of American consumers who have a passion for our products and the dedicated U.S. dealers and partners who retail and service them most certainly is. We encourage USTR to find more appropriate and relevant measures to settle its beef with the European Union."
It is unknown when U.S. officials will decide on which European goods will be hit with the stiff tariffs.