Tariff Proposal Could Impact The Collector Car Market

Tariff Proposal Could Impact The Collector Car Markethttps://d2d49q62n92ko8.cloudfront.net/wp-content/uploads/2018/06/20025701/1964-Porsche-904-GTS.jpghttps://d2d49q62n92ko8.cloudfront.net/wp-content/uploads/2018/06/20025701/1964-Porsche-904-GTS.jpghttps://d2d49q62n92ko8.cloudfront.net/wp-content/uploads/2018/06/20025701/1964-Porsche-904-GTS.jpg

President Trump’s Tariff Proposal Could Impact The Collector Car Market. Sandra Button has a some fierce words to say.

“I cannot imagine what might happen if imported collector cars and car parts are designated as national security risks and taxed at 25 percent,” the chairman of the Pebble Beach Concours d’Elegance wrote late last week in an email she distributed to dozens of leaders of the collector car community.

“I cannot imagine how we will be able to maintain and share even the collector cars we already have in the United States — whether first made here or abroad. How will we be able to continue to use them?”

Button called for collector car enthusiasts to join her in contacting the U.S. Department of Commerce, which has a public comment period only until June 22, and also vowed to testify on the matter in Washington, D.C.

“I have a hundred additional questions,” she said. “At present, the proposal before us has no answers for me.”

Late last month, President Trump proposed a 25 percent tariff on imported automobiles and auto parts. Though apparently aimed at protecting American manufacturing jobs by targeting new vehicles, the proposal also would apply to vehicles of all vintages.

According to a U.S. government website, interested parties can submit written comments, data, analyses, or other information pertinent to the issue by June 22. Rebuttal comments are due by July 6 and a public hearing is scheduled for July 19-20.

“If this proposal is carried out, it would deal a staggering blow to the very industry it purports to protect and would threaten to ignite a global trade war,” Thomas J. Donohue, president of the U.S. Chamber of Commerce, told The New York Times.

Donohue was speaking of the American auto industry and its suppliers, but many feel the impact would be just as crucial to the collector car hobby.

Prominent collector car dealer Mark Hyman was notified by attorney Marshall Miller about the tariff’s possible impact on the collector car hobby. Hyman sent an email urging people to contact their Senators and Congressmen as well as the Dept. of Commerce.

Noting that there already is a 2.5 percent tariff on imported vehicles, Hyman said, “Clearly, the importation of classic and collectible vehicles has absolutely no impact on our National Security, and these proposed tariffs would only serve to harm the countless individuals and independent businesses who buy, sell, restore and transport cars.

“The collector car hobby is a multi-billion dollar-per-year business, and we must work together to fight this ludicrous proposal. Washington bureaucrats have no understanding of the impact such a political stunt would cause, therefore it is our responsibility to educate them.”

Among those Hyman contacted was John Carlson, president of the National Association of Automobile Clubs of Canada and a leading concours judge. Carlson, alarmed that Canadians would have an increasingly difficult time selling collector cars to American buyers, also sent out an email blast, followed in turn by Button’s.

1949 Mercury Monarch. If tariff passed, the buyer would have to pay an extra $14,000.

Button noted that the proposal “could potentially greatly harm the cars we love and our ability to share and celebrate them.”

Not only would prices increase for those buying a collector car from Canada, Europe, Asia or elsewhere, but the already expensive imported parts needed to restore or even to simply keep an imported classic car running suddenly would cost you an extra 25 percent.

For example, in February, an American collector paid $1,660,292 for a 1964 Porsche 904 GTS at Artcurial Motorcars’ auction at Retromobile in Paris. To bring that car home with a 25 percent tariff, the collector would have to pay the U.S. government $415,073.

And it’s not only high-end vehicles. Say you’re driving from Detroit to Buffalo, New York. You might be taking the delightful shortcut across Ontario, Canada, and you might want to stop in London, Ontario, to buy a 1949 Mercury Monarch being advertised on ClassicCars.com. The private seller wants $55,000. But to drive that car across the border into the U.S. under the proposed tariff schedule, the feds would demand you pay another $13,750 for that privilege.

On Tuesday afternoon, SEMA, the trade group for automotive aftermarket parts producers, issued a statement warning that the proposed tariffs are “a tax on American companies and consumers,” and noted that member companies already are “grappling with higher-priced steel and aluminum because of global tariffs.”

“SEMA welcomes efforts by the U.S. government to protect American companies and their customers from unfair trading practices,” Christopher Kersting, the SEMA president, was quoted in the release. “We urge the president and Congress to pursue trade infringements in a fashion that does not inflict unintended economic harm.”

How many cars could be impacted by the proposed tariff? Warren Barnes of Schumacher Secure, a company that specializes in shipping collector vehicles, both for private owners and for auction houses, said that last year his company shipped nearly 20,000 vehicles out of the U.S. and brought in somewhere between 4,000 and 5,000.

“And that’s just our company,” he added.

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