Mahindra Pickup Update

[Scooby074]

That chicken tax is really a thorn in the sides of manufacturers trying to bring new or more efficient products to market. Should be abolished.

 

[salopez]

I thought 4 door machines didnt get taxed like trucks?

 

[Scooby074]

I thought 4 door machines didnt get taxed like trucks?

I dont know of a 4 door exemption but would be interesting to hear.

"The Chicken Tax was instituted back in 1963, and was aimed at European (read VW) truckmakers. The long and the short of it is that there was a trade war going back then between the USA and Europe. The Europeans tripled the tax of chickens being imported into Europe, and the US retaliated by putting a 25% tax on any truck imported into the USA. That's how it came about, and we've lived with it ever since..."

 

[kenmac]

don't know what the will look like... Heard on the news last week ? that we are to get a Mahindra truck / SUV dealership in my area soon

 

[salopez]

the only thing I know is that the us imposed a huge tax (or started inforcing) on imported (mostly japanese) trucks in 89 this is when you stopped seting 2dr pathfinders, 4runners, and troopers. they were considered trucks, but they werent trucks if they had 4 doors.

 

[Scooby074]

the only thing I know is that the us imposed a huge tax (or started inforcing) on imported (mostly japanese) trucks in 89 this is when you stopped seting 2dr pathfinders, 4runners, and troopers. they were considered trucks, but they werent trucks if they had 4 doors.

Interesting. I did a bit of research on it. Seems like the new Ford Transit Connect is made in Turkey and shipped here with rear seats. Somehow this avoids the chicken tax? maybe its considered a bus or something with the extra seats? dont know.

But when the vehicle arrives in the US, the rear seats are removed, and shredded because its mostly sold as a 2 seat delivery van. This is absurd and a waste of resources. And a good reason why the tax should be eliminated.

Another example is the Sprinter. Completely assembled in germany, then they have to remove the engine to ship to the states where the engine gets re-installed. Ta-da no chicken tax but a waste of resources and added expense.

Ive read several things about Mahindra trying to avoid the chicken tax. They have mentioned several ideas, from shipping trucks over like the Sprinter (ie missing engines or other parts) to eating the tax to building the trucks from scratch in the US.

Most current thing i read was they were shopping for a US plant to build from scratch. Possibly this is the cause for the delay.

The chicken tax is preventing the import of lots of IMHO awesome vehicles that would be a big seller, but maybe not in the volumes or at a cost that would justify jumping through the added hurdles to get around the tax or ticking of the UAW.

A great example of this is the Toyota HiLux Diesel. Built in Argentina (i believe) and sold in the rest of the world, but not here. Pretty much my dream truck. Not a behemoth like the current USDM Tacoma has become. I know it would be a big hit if it was brought here with the Diesel. Way nicer than this Mahindra.

Another one is the Ranger sold elsewhere made in Brasil or Austrailia (Thailand?). Personally i like the Aussie model more. But both are Really nice design, with the diesel. Way better than the ancient Ranger sold here. Our ranger is something like 10 years on this current design with only a facelift along the way.

 

[MahindraPlanet]

Kenmac, Please share with us who and where your local dealer is? I’m curious if it’s someone we’ve already listed on the blog or not. Global Vehicles is non-responsive to my request for a dealer listing.

As far as US assembly or manufacture, I was hoping last year that Mahindra would take advantage of their long time connection with International Truck and Engine. I’m holding out hope for that scenario.

I read an article last week (I can’t find it to hyperlink) that speculated Ford’s future small truck plans. 2011 is supposed to be the final year of the current US-version Ranger. The speculation is that we will either get the world-market small truck (that Scooby074 mentioned) or an all-new mid-size pickup. I really hope they opt for the small truck and bring diesels over with them. Maybe they will wait and see how Mahindra makes out first.

 

[Heywood Jannockitov]

Most current thing i read was they were shopping for a US plant to build from scratch. Possibly this is the cause for the delay.

The NUMMI plant in Fremont CA is available now that Toyota has announced that they are pulling the plug on it as well as GM.
I wouldn't be surprised if Mahindra has a team scoping that plant out, among others.

 

[Diamondpilot]

The NUMMI plant in Fremont CA is available now that Toyota has announced that they are pulling the plug on it as well as GM.
I wouldn't be surprised if Mahindra has a team scoping that plant out, among others.

My experience with closed plants is no upstart is going to want it for 3 main reasons. 1st and foremost, the reason these plants have closed is due to high labor cost mainly associated with the unions. They will not want that. Second is the plant will need a lot of modifications to meet their needs and 9 times out of 10 you can start from scratch with a new plant cheaper. Third and probably the biggest factor is there are areas of the country willing to give large grants for upstarts to bring jobs. I just read where a factory is being built 4 miles from a 3 year old factory that is closed because its in another county that is giving them 330 million in grants and tax breaks. Remember, it all comes down to business.

Chris

 

[Heywood Jannockitov]

Yes, I'm sure that is true, but I doubt that they would categorically dismiss an existing assembly plant simply because it was .., well..., already existing. If they are like most other foreign companies, they will scout out many locations, existing or not, come up with a short list of potential sites, then let the various state and/or local governments duke it out to see who can offer the best incentive package.

 

[Diamondpilot]

Yes, I'm sure that is true, but I doubt that they would categorically dismiss an existing assembly plant simply because it was .., well..., already existing. If they are like most other foreign companies, they will scout out many locations, existing or not, come up with a short list of potential sites, then let the various state and/or local governments duke it out to see who can offer the best incentive package.

100% correct. Seems like such a waste though. We had tons of GM plants close to here, maybe a 20 mile radius, in the late 90's after the big strike they closed. GM gave them to the local government and after 6-7 years of no interest most were torn down because of on going maintenance cost. At one time they employed almost 100,000. They tried to sway Honda Toyota, Subaru, and others to come but they wanted no part of a UAW town. Instead they built all around us.

Chris

 

[flusher]

I just read in a 4x4 mag that Mahindra is trying to find a way around the 25% import tax. It said the trucks may have a final assemble in the U.S. JC

How is "final assembly" defined vis-a-vis that import tax?

I see Kubota and Mahindra tractors delivered to dealers in steel frame crates minus wheels, seat, ROPS, steering wheel (?), etc. Is dealer assembly in this case considered "final assembly"?

 

[dodge man]

I think Kubota ships their tractors that way because its the easiest way to ship them, and no other reason. A lot of their stuff is put together in the U.S.

 

[Scooby074]

How is "final assembly" defined vis-a-vis that import tax?

I see Kubota and Mahindra tractors delivered to dealers in steel frame crates minus wheels, seat, ROPS, steering wheel (?), etc. Is dealer assembly in this case considered "final assembly"?

I cant say exactly how its defined. I know Sprinter is shipped minus engine and tranny as a "complete knockdown kit" to avoid tax.Complete knock down - Wikipedia, the free encyclopedia

Somehow the Transit gets sipped with rear seats to avoid the tax.;... I dont know how this works?

Mahindra has a history of using CKD's . The Jeeps they sold were CKD

 

[Scooby074]

My experience with closed plants is no upstart is going to want it for 3 main reasons. 1st and foremost, the reason these plants have closed is due to high labor cost mainly associated with the unions. They will not want that. Second is the plant will need a lot of modifications to meet their needs and 9 times out of 10 you can start from scratch with a new plant cheaper. Third and probably the biggest factor is there are areas of the country willing to give large grants for upstarts to bring jobs. I just read where a factory is being built 4 miles from a 3 year old factory that is closed because its in another county that is giving them 330 million in grants and tax breaks. Remember, it all comes down to business.

Chris

Chris: I agree with most of that. However In Nummi's case i think that their wages were pretty much inline with the rest of Toyotas manufacturing.

I think the nail in Nummi's coffin was the death of Pointiac. They lost half of their production, so it wasnt cost effective.

Throw into the mix that there is Toyotas texas plant that is way under its capacity (due to slow TUndra sales) and its a no braner to move Taco production there.

Also, im sure that California's enviromental regs played a part in this decision.

 

[newbury]

There's also a wonderful BRAND NEW NEVER BEEN USED Toyota plant in Tupelo Ms.
They built it originally for Toyota SUV's - in about '08 they changed and PLANNED to switch to Prius. Then the bottom dropped out of the market and there is this humongous plant that is only basically employing security guards.

About Toyota | Our News | Toyota To Build Highlanders in Mississippi
Road work continues with Toyota plant on hold

Of course that would drive up the price of land

 

[Diamondpilot]

How is "final assembly" defined vis-a-vis that import tax?

I see Kubota and Mahindra tractors delivered to dealers in steel frame crates minus wheels, seat, ROPS, steering wheel (?), etc. Is dealer assembly in this case considered "final assembly"?

Not just them. JD, Case, and Massy come that way also. I know this because I stay next to assembly local in Louisiana twice a month and watch them out my hotel room window.

Chris

 

[Diamondpilot]

There's also a wonderful BRAND NEW NEVER BEEN USED Toyota plant in Tupelo Ms.
They built it originally for Toyota SUV's - in about '08 they changed and PLANNED to switch to Prius. Then the bottom dropped out of the market and there is this humongous plant that is only basically employing security guards.

About Toyota | Our News | Toyota To Build Highlanders in Mississippi
Road work continues with Toyota plant on hold

Of course that would drive up the price of land

Same thing in Kokomo Indiana on a Chrysler tanny plant. The state put up millions along with the county and city. The economic crisis happened and the plant was 95% done and as part of the bankruptcy they walked leaving us, the tax payers to pay the bill.

Chris

 

[archerm3]

Even unloaded, most people don't merge properly.
I know when I'm driving the Semi, I don't even think about pulling over for someone unless they are actualy trying to merge and give it some of the skinny peddle. so basicaly I almost never even look and just leave the cruise on. Those middle fingers sure hurt my fealings

amen.

 

[Groo]

How is "final assembly" defined vis-a-vis that import tax?

I see Kubota and Mahindra tractors delivered to dealers in steel frame crates minus wheels, seat, ROPS, steering wheel (?), etc. Is dealer assembly in this case considered "final assembly"?

I think the old toyota pickup that all have rusty beds are a symptom of this.
I heard they shipped the beds unpainted, then painted and assembled them here for tax purposes. unfortunatly they were already exposed to all that salt air in transit, and the salt residue was already in place under the paint.