Is the “Chicken Tax” Dead? Will We See the Ranger Now?
Laws are written and passed for a variety of reasons. Sometimes, they are written to attempt to protect American interests and businesses. One such law that was written for that reason was what most people refer to as the “Chicken Tax.” This law levies a 25% import tax on foreign-made light trucks. Initially, the law was retaliatory against West Germany’s heavy tax on U.S. Poultry imports, but the law has stuck around.
However, now the President of the United States is working on negotiating new global trade agreements, and Congress supports his agenda. One of the levies that seem to be going away would be the “Chicken Tax.” That could have huge implications on our motoring environment.
Why? Because it means we could get the Ranger!
Right now, the Ranger is not built in the United States. It would be subject to the import duty the same as any other vehicle would. With the tax gone, Ford could easily load them on a boat and ship them to the United States and sell them.
However, if Ford were to truly sell the Ranger in the United States, they’d probably assemble it here, because that’d still be more cost-effective. Since they haven’t done that already, even under stiff pressure from the Chevrolet Colorado and GMC Canyon, the removal of the “Chicken Tax” alone wouldn’t be enough to get them on Team Ranger.
However, not having the “Chicken Tax” would mean that other light-duty truck manufacturers, such as Volkswagen, could easily sell their light-duty trucks here in the United States.
That tax forced automakers like Honda to build their Ridgeline truck in the United States. It’s why the Nissan Titan is built Stateside. Heck, even BMW builds vehicles in the United States because of the tax.
If in addition to Colorados and Canyons we start seeing Amoraks and others on U.S. streets, the market might end up being competitive enough to Ford to get in and play.
But even if it doesn’t convince Ford that we need to have the Ranger available for sale, it would open up the truck market to more competition. More competition has many benefits, including manufacturers who’d compete to drive the price down, and not up.
There would still be “Cowboy Cadillacs” like the F-150 Platinum or the Ram 1500 Laramie Limited, but we could also see the return of small, cheap transportation similar to the Subaru Brat from back-in-the-day. Hyundai already showed us a concept of something similar, called the Santa Cruz.
I’ve outlined some of the other reasons why I don’t think Ford wants to sell the Ranger here, but none of those reasons really addresses the increased competition that could come from the abolishment of the “Chicken Tax.” It’s not something that’d happen overnight, as manufacturers would still have to determine is the United States is the right market to sell their light-duty wares, but it would give manufacturers more reasons to consider the North American market. That has to be a good thing, right?
What do you think? Head over to the forums and let us know your thoughts!