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NMMA fighting trade war on three fronts

By The National Marine Manufacturers Association

The global trade war has intensified in the past two weeks, and the recreational boating industry has been placed in the crosshairs.

The National Marine Manufacturers Association continues to pressure the Trump Administration to resolve this conflict and is working with Congress on legislative solutions while keeping members updated and media informed of the association's message.

NMMA needs the industry’s help to ensure President Trump is aware of the impact to the recreational boating industry.

The U.S. marine industry is facing a triple threat from Section 232 tariffs on steel and aluminum, anti-dumping and countervailing duties on Chinese aluminum sheet, and Section 301 tariffs on nearly 300 marine related products.

As a result, the industry is being confronted with rising costs of raw materials, component parts, and retaliation from our top trading partners.

Since the Trump Administration’s decision to impose tariffs under Section 232 of the Trade Expansion Act of 1962, marine manufacturers have seen substantial price increases for the worldwide cost of aluminum.

In addition, after several unsuccessful attempts to negotiate exemptions to Section 232 tariffs, Canada, the European Union, and Mexico responded with retaliatory tariffs on U.S. boats, with Mexico’s taking effect immediately.

The majority of boats entering the EU will face a 25 percent tariff, while Canada is applying a 10 percent tariff and Mexico a 15 percent tariff. This includes all types of recreational boats on their lists, impacting roughly 69 percent of total U.S. boat exports.

NMMA is working with Congress on legislative solutions and yesterday pledged support for bipartisan legislation introduced by Senator Bob Corker (R-TN) to require Congressional oversight of all proposed trade actions in the name of national security under Section 232.

NMMA is also seeking a permanent exemption for the EU, Canada, and Mexico.

The price of aluminum is also being impacted by a current antidumping and countervailing duty investigation on Chinese aluminum sheet.

While nearly 90 percent of U.S marine manufacturers that use aluminum source it domestically, these investigations have disrupted costs across the globe, resulting in higher prices and supply shortages in the U.S. market.

The compounding effect of Section 232 tariffs and the investigation on Chinese aluminum sheet is stifling the growth and economic viability of the industry’s manufacturing sector.

Back in April, the administration announced tariffs under Section 301 Trade Act of 1974 on $50 billion worth of Chinese products.

Nearly 300 marine related products were contained on the initial list of tariffs. Ranging from engines and propellers to marine navigation and component parts, these products would be subject to a 25 percent tariff. For some products, the additional cost to the consumer would be as much as $2,000.

The NMMA testified before the Section 301 investigation committee on May 15, requesting marine products be removed from the final list. Additionally, NMMA members submitted over 90 comments to the US Trade Representative during the public comment period.

The final list of imports subject to Section 301 tariffs is scheduled for release on June 15.

NMMA’s President Thom Dammrich, sent a letter to President Donald Trump, which raised the industry’s concerns and called on the president to find a solution that immediately resolves the situation.

“It is imperative your administration consider the negative downstream impact these compounding tariffs will have on the marine manufacturing industry, especially the consequences such action would have on consumers,” Dammrich wrote. “American businesses should not be subjected to steep tariffs for conducting international commerce, which supports job creation and economic growth here in America.”

The boating industry in Canada is also feeling the impact of tariffs. What has erupted into a trade war with the U.S. will severely harm the $10 billion Canadian recreational boating industry which employs 75,000 Canadians.

Approximately 65 percent of total boat sales in Canada are manufactured in the US. In fact, the US is the top market for both imports and exports in Canada with engines and boats imported from the US totaling $797.2 million and exports into the US totaling $192.8 million.

NMMA Canada will be sending an action alert to the Canadian marine industry asking for help in contacting members of Parliament.

The comment period in Canada closes on June 15. Canadian-based members of NMMA should contact NMMA Canada President Sara Anghel with questions.

For more information, please contact NMMA Senior Vice President of Government and Legal Affairs Nicole Vasilaros or NMMA Director of Federal Affairs Lance West.

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