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CHRYSLER BACKS TRADE BILL, BUT SAYS IT CAN BE STRENGTHENED

 CHRYSLER BACKS TRADE BILL, BUT SAYS IT CAN BE STRENGTHENED
 WASHINGTON, May 14 /PRNewswire/ -- Chrysler Corp. (NYSE: C) today announced support for the proposed Trade Expansion Act of 1992, but said that the legislation should be strengthened to deal with the confusing and costly way the government classifies multi-purpose vehicles (MPVs).
 Robert A. Perkins, Chrysler's vice president-Washington Affairs, told a House Ways and Means Subcommittee hearing on the bill that adding an MPV provision would be "the single most important thing that could be done for the industry in this bill."
 He noted that imported four-door MPVs are currently classified as trucks by all branches of the federal government except the Department of Treasury, which classifies them as cars. That exception allows the imports to pay the 2.5 percent import duties imposed on passenger cars rather than the 25 percent tariff assessed on other vehicles. The result has been a loss to the U.S. Treasury of more than $300 million in revenues.
 "You never give away a $300 million trade concession without getting something for it," Perkins said, adding that the only thing the United States got for the concession was "a 51 percent increase in Japanese market share for MPVs since 1989."
 "The American consumer didn't benefit from that 22.5 percent reduction in the tariff. Only the Japanese manufacturers did," he said.
 Perkins praised the bill for focusing on the automotive sector, which accounts for $33 billion of the current U.S. trade deficit with Japan. Among its provision, the bill calls for investigations into trade barriers that are keeping U.S. vehicles and automotive parts out of the Japanese market.
 Chrysler answered one of the criticisms of the U.S. industry by investing $35 million to build right-hand-drive Jeep Cherokees, Perkins noted. But the 1991 sales projection of the Japanese distributor of the Jeep Cherokee is only 700 units.
 "If we were able to sell the same percentage of the sport utility market in Japan as we are in the United Kingdom and Australia, our sales next year would be between 6,000 and 15,000 units in Japan," he added.
 "This is not the time for business as usual," Perkins said. "The time for textbook economics is over. The deficit and level of foreign penetration in Japan are unsustainable, and unless they are rectified, the U.S. auto industry as we know it will no longer exist."
 -0- 5/14/92
 /CONTACT: John Guiniven of Chrysler, 202-862-5409/
 (C) CO: Chrysler Corporation ST: District of Columbia IN: AUT SU: LEG


DC -- DC018 -- 0305 05/14/92 14:03 EDT
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Date:May 14, 1992
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