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WAYS & MEANS VOTE TO IMPOSE 25 PERCENT TARIFF ON MPVS; COMMITTEE APPROVES BILL TO GUARANTEE BIG THREE MONOPOLY MARKETSHARE IN MPVS

WAYS & MEANS VOTE TO IMPOSE 25 PERCENT TARIFF ON MPVS; COMMITTEE

APPROVES BILL TO GUARANTEE BIG THREE MONOPOLY MARKETSHARE IN MPVS
 ALEXANDRIA, Va., June 24 /PRNewswire/ -- "The House Ways and Means Committee today approved a measure to guarantee the Big Three a monopoly marketshare in the minivan and sport-utility vehicle market, allowing the Big Three to price-gouge the middle-class American consumer," said Walter E. Huizenga, president of the American International Automobile Dealers Association.
 "The Big Three automakers' real motive behind the so-called reclassification of these import vehicles was very apparent today," Huizenga said. "By exempting small-volume manufacturers and targeting Japanese automakers, the Big Three clearly indicated that their arguments were just a protectionist sham -- aimed at eliminating their main competitors and padding their profits at the expense of the American consumer."
 The committee approved 24 to 12 an amendment to the Miscellaneous Tariff Bill (H.R. 4318) offered by Rep. Sander Levin (D-Mich.). The measure would raise the tariff on imported minivans and sport-utility vehicles from 2.5 percent to 25 percent, and exclude import manufacturers that sold less than 10,000 units in 1988. This effectively snares all but one of the Japanese automobile manufacturers of these import vehicles.
 "These import vehicles could be eliminated from the U.S. market when the prices rise by thousands of dollars," Huizenga said. "The Big Three have shown that, once competition is reduced or eliminated, they will raise prices. Middle-class American consumers will be forced to pay more for their sport-utility vehicles and minivans, while losing choice in the marketplace.
 "This bill will raise no revenue. The tremendous price increases resulting from such a high tariff could eliminate these vehicles and the tariffs collected," Huizenga said. "2.5 percent of something is better than 25 percent of nothing."
 The proposed tariff, one of the highest in the industrial world, would add up to $3,739 to the price of an imported vehicle, if passed on to consumers, according to a soon-to-be-released study by Citizens for a Sound Economy. And according to previous studies by the Brookings Institution and the Institute for International Economics, a 1 percent increase in import prices allows domestic automobile manufacturers to raise their prices by up to 0.4 percent. That would mean a price hike of $1,331 for a domestic vehicle.
 AIADA is the trade association of America's international automobile dealers, representing more than 10,000 American businesses selling and servicing world class automobiles.
 -0- 6/24/92
 /CONTACT: Paul Donnellan of the American International Automobile Dealers Association, 703-519-7800/ CO: American International Automobile Dealers Association ST: Virginia IN: AUT SU: LEG


IH -- DC034 -- 3507 06/24/92 17:53 EDT
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Publication:PR Newswire
Date:Jun 24, 1992
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